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Welcome to the October edition and the ‘ADIPEC’ edition of ‘OGV Energy Magazine’ where we will be exploring the theme of ‘International Growth’.
A big thank you to our front cover partner Vulcan Completion Products Ltd and you can hear all about the first anniversary of their key Middle East partnership with technology and energy group, Sawafi Al-Jazeera Oilfield Products and Services Co. (Sawafi), on pages 4 and 5.
We also have contributions from Exceed, Newland Oil Tools, The Impulse Group, JBS Group, Aisus Offshore, Proserv, Intervention Rentals, Worley, Sword Group, Leyton and HFI International and very own digital business The OGV Studio.
The rest of this month’s magazine as always provides you with a review of the Energy sector in the North Sea, Europe, Middle East, the US and Australasia along with industry analysis and project updates from Westwood Global Energy Group, the EIC and Renewables UK.
Warm regards
Dan Hyland Director
An international leader at the forefront of next generation creative solutions for the oil and gas completions market is celebrating the first anniversary of a key Middle East partnership with technology and energy group, Sawafi Al-Jazeera Oilfield Products and Services Co. (Sawafi).
Aberdeenshire-based Vulcan Completion Products (VCP) has marked the significant milestone by announcing that the company has recently secured $12 million of work in the region. The news extends and deepens relationships with existing clients in the area and the projects will be delivered over the next 2-3 years.
The collaboration with Sawafi is part of a bold postCovid growth strategy at VCP. Established in 2013, Sawafi is a global leader in upstream technologies including drilling enhancement, intelligent completion products, artificial lift products, well characterization and visualization, well real-time survey services, and artificial intelligence analytics and alerts.
VCP’s success in the Middle East is underpinned by its manufacturing facility in the Kingdom of Saudi Arabia which opened last year in 2022. This Aramcoapproved location operates in collaboration with local partner company Saja Energy and delivers expertise, superior service, and an unrivalled commitment to the region’s clients.
In late 2022, VCP announced a significant development when it relocated its Middle east office to a larger space in Dubai. This strategic move reflects the company’s commitment to enhancing its position within the Middle East, a region of paramount importance,
both historically and in the company’s ambitious plans for the future. Last year’s investment also empowered Vulcan Completion Products to expedite its plans in The Americas, spurred on by a Houston office expansion and a key management appointment dedicated to nurturing existing client relations in the region and pursuing additional opportunities.
VCP has already doubled the size of its team over the last 12 months employing dedicated professionals in key locations around the world. They have cultivated an exceptional reputation and consistently surpass customer expectations in design, manufacture, and applying bespoke, innovative, and groundbreaking solutions. From centralisation products, reamer guide shoes, float equipment, cement plugs, stop collars and a range of completion accessories. VCP boasts an unmatched record of success – their unwavering focus on quality service provision and consistently exceeding client expectations has set them apart.
With a combined experience of more than 200 years and a robust global network of carefully selected agents, the company directly serves IOCs, NOCs, major players and headline service companies.
Among VCP’s standout products are the industry-hailed Phazer™: Flex and Phazer™: Flex TT (Tight Tolerance). These centralizers offer superior stand-off in open holes, while maintaining ultra-low drag in restricted cased holes. All Phazer™ Flex products are tested to API and beyond.
Commenting on the recent announcement, VCP Middle East Regional Manager Mike Fraser said: “By combining Saja Energy’s world-class facility with our products, expertise, and knowledge we positioned Vulcan Completion Products at the heart of the region, allowing us to be agile in fulfilling customer requirements for the Region & beyond. This synergy has been instrumental in recent contract wins and, along with our strong relationship with Sawafi, it is a key driver for growth throughout and beyond the Middle East.”
Vulcan Completion Products President/MD Ian Kirk added: “By establishing a presence in key emerging markets, consolidating our position in others, and strategically placing the right talent in the right locations, we are realising our objectives.
He added: “As a very experienced team, we have been able to fast-track VCP’s development into the Kingdom of Saudi Arabia, which has enabled us to hit the ground running in a key part of the world – in just five years
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A rising star at accountancy firm Infinity Partnership is celebrating after being selected for a coveted honour.
Chloe Leslie, 23, was nominated for the Aberdeen Young Professionals (AYP) 30 Under 30 list, which celebrates the next generation of leaders, innovators and change-makers across Aberdeen and Aberdeenshire.
A celebratory AYP event is being held on Thursday, September 14, at award sponsors Namaste Delhi, Bridge Street, Aberdeen, to acknowledge the achievements.
Chloe joined Aberdeen-based Infinity as an accounts assistant in 2018 and, within just five years, is now a client relationship associate overseeing her own diverse client portfolio, which covers a host of sectors from energy to tech start-ups.
Industrial cleaning specialists, Sureclean, has unveiled a new purpose-built NORM decontamination facility that is believed to be the first of its kind to be powered by sustainable technology.
The 1.25 million-pound 3-acre licenced facility has been built at the company’s 5-acre base in Oldmeldrum, Aberdeenshire, and forms a key part of its growth trajectory to strengthen capabilities and bring wider environmental benefits to the global energy industry.
Experts in industrial cleaning and oil spill emergency response within the global energy and renewable sectors, Sureclean has over 80 years of combined management experience delivering multi-skilled industrial cleaning services.
Global Underwater Hub (GUH), the trade and industry development body representing the UK's growing £8 billion underwater industry, has opened a new north England regional office in Newcastle upon Tyne. The new premises mark the next phase in the organisation’s plans to support the future growth of this diverse, world-leading industry and the wider blue economy.
With funding assistance from UK and Scottish governments, the base will serve as a hub for GUH’s members across the north of England. Featuring a dedicated event space, the building will bring together companies working across the oil and gas, offshore energy, defence and subsea cable sectors in the region, and further afield, to enable collaboration and facilitate the exchange of ideas and technology across the sectors.
KCI, a leading provider of oil and gas technology and services, will be exhibiting at the Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC) from October 2-5, 2023. KCI will highlight its innovative solutions that help operators across the Middle East maintain production, reduce costs, and maximise efficiency.
With demand increasing for its services in the region, KCI is expanding its presence and capabilities throughout the Middle East. The company's leak sealing technology has already saved a client over $10 million by enabling quick, safe, rigless repairs. KCI has developed its product range specifically to address challenges like aging infrastructure, harsh environments, and corrosive fluids. Its premium quality sealants can isolate wellheads and other critical components to prevent leaks and enable continued production.
Leading global training and learning organisation, 3t, has unveiled its new brand showcasing its new vision and identity ahead of SPE Offshore Europe 2023.
Supporting safety-critical industries with the highest-impact learning, 3t’s new brand reinforces the cornerstones of Training, Technology, and Transformation at its core. The group will unite its businesses under one strong, unified, and instantly recognisable brand identity; and that brand is 3t.
With eight UK and two international training centre locations, and several expert-led sales offices located strategically around the world, 3t has enjoyed an exciting period of growth in recent years. 3t is the sum of its four businesses, previously AIS Survivex, UCT, 3t Transform, and Drilling Systems, makes 3t stand out in its key sectors, offering customers a unique combination of engaging and safety-critical in-person training with technology and digital learning solutions that exponentially transform learning outcomes for individuals, businesses and its industries.
ModuSpec is extremely pleased to announce the extension of a multi-million-dollar global frame agreement for BOP inspection services with upstream operator, bp.
ModuSpec, a Vysus Group company, has been delivering BOP inspection services support to bp for more than eight years. With this five-year extension, which could be worth circa $10 million per year, ModuSpec could be called upon to provide support across bp’s global operations.
Johnny Benoit, SVP ModuSpec, said: “To continue our trusted relationship with bp is extremely pleasing and is testament to the value that they place in our ability to support their operations. With rig market activity and demand for drilling continuing to rise globally, it’s as important as ever to our clients that we are there to support with our technical expertise, backed up by the knowledge and experience a longterm relationship brings to the table.
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MacArtney is a privately owned company founded in 1978; having an extensive track record within the industry as well as strong financials, we strive to work closely with our customers to provide optimal solutions while adhering to the highest standards of service and quality.
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From our global network of more than 60 locations, OEG Offshore provides a range of integrated services to the energy sector including offshore containers and modular solutions, welfare units, temporary power, radio communications as well as topside and subsea services.
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Rysco Corrosion Services Inc. is an Oilfield Services company dedicated to providing corrosion monitoring solutions to oil and gas producers. We can provide a timely response to the service needs of producers. Our field crews travel from North East British Columbia to South West Manitoba, and all points in between.
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But half of the estimated spending, £100 billion, is associated with projects still awaiting final investment decision—they are either in planning or waiting for company and government approvals.
“Moving these projects forward is crucial in helping to build increased energy security, reducing emissions and providing new economic growth and employment opportunities,” OEUK said.
The UK could also potentially see £35 billion of oil and gas capital investment over the next 10 years, of which about half will go on projects in producing fields and half on new fields. However, nearly 70 percent of this projected investment has yet to be secured.
Without secured investment, the UK will produce 1.2 billion boe less over that period, and the loss will get larger over time. In addition, up to £70 billion could be spent on operations and more than £20 billion on decommissioning during the same period, according to the report.
generated almost £30bn in GVA, representing around 1.5% of the total UK economy. This is the bedrock of expertise on which we can build future energy infrastructure for the benefit of everyone in the UK,” Whitehouse says Separately, OEUK responded to the new Scottish Programme for Government, which reiterates Scotland’s commitment to accelerate the green energy rollout.
The Scottish Government pledged to speed up renewable energy projects with a new deal for the onshore wind industry. The government also plans to develop a Green Industrial Strategy to help businesses and investors realise the economic opportunities of the transition to net zero and of creating good, well-paid jobs in sectors such as offshore wind and hydrogen, while also supporting the development of sectoral Just Transition Plans.
Offshore Energies UK (OEUK), the leading industry body, published its Economic Report 2023, which calls for increased efforts to unlock billions of pounds in energy investment so that the UK can compete globally in offshore industries including renewables capacity, carbon capture, and low-carbon hydrogen.
“Make no mistake, the UK is in a global race for energy investment, and we need to be successful,” Dave Whitehouse, CEO at Offshore Energies UK, wrote in the foreword to the report.
OEUK estimates that the UK’s offshore energy sector could spend around £200 billion by the end of the decade on the effective management of oil and gas production and decommissioning, expanding offshore wind capacity, and establishing large-scale low carbon hydrogen production and carbon transport and storage industries.
“Achieving this depends on several factors which impact on investor sentiment and project economics – such as the competitiveness and stability of the fiscal regime, the cost environment, commodity prices and, importantly, government support for new licensing and exploration,” the industry body noted.
In the speech to launch the report, OEUK’s Whitehouse said, “The windfall tax is biting. All credible net zero scenarios say that we will need abated oil and gas for decades to come. In the first six months of this year, 13% less crude oil was extracted from the North Sea and the mainland. With investment on hold, our production volumes are as low as they have ever been.”
The UK needs to reframe the energy debate to help unlock investments, Whitehouse added.
“So, this debate is not oil & gas versus renewables. We need to support both oil and gas and renewable energy. Increasingly these are the same companies and people,” OEUK’s chief executive noted.
“Today the offshore oil and gas industry supports around 220,000 jobs and in 2022
OEUK’s Whitehouse commented on the plan, “It is great to see clear intentions for energy expansion in the Scottish Government’s new programme for government. Yet this positive sentiment must include support for Scotland’s oil and gas sector.”
“As we build a sustainable energy future there is no simple choice between oil and gas and renewables. By the mid-2030s, oil and gas will still provide for 50% of our energy needs, so the reality is that to keep the lights on and grow our economy, we need both,” Whitehouse added.
“The companies investing in low carbon technologies require the cashflow from a stable and predictable oil and gas business to fund these opportunities, and any licences going forward are subject to a climate compatibility checkpoint and projected emissions have already been taken into account.”
Greenhouse gas emissions from UK offshore oil and gas production fell for the third consecutive year in 2022 as industry continued its drive to reach net zero by 2050, according to the latest Emissions Monitoring Report from the North Sea Transition Authority (NSTA).
The report estimates that emissions declined by 3 percent in 2022, which contributed to a 23-percent reduction in greenhouse gas emissions between 2018 and 2022.
The annual economic report by the leading offshore industry body, falling emissions from North Sea operations, and approvals for new field developments were the highlights in the UK North Sea oil and gas sector in September.
Emissions were reduced in 78 percent of offshore facilities between 2018 and 2022, with 59 percent of the reductions coming from active emission reduction measures and the rest via cessation of production.
Methane emissions are estimated to have fallen by more than 40% between 2018 and 2022 to fewer than one million tonnes of carbon dioxide equivalent – a record low, NSTA’s analysis showed In addition, flaring fell by more than 10 percent last year, contributing to a reduction of nearly 50 percent between 2018 and 2022.
“Although industry is making strong progress, there is more work to do. The NSTA estimates that without the implementation of further emissions abatement initiatives, the sector will not meet the 2030 target,” NSTA said in the report.
The UK industry could look to Norway as an example of further declines in emissions.
While the carbon footprint of UK-produced gas is on average around a quarter of that of imported LNG, the pipeline gas the UK imports from Norway is cleaner, with less than half the production and transport-related carbon intensity of UK gas.
“The similarities between the UK and Norway offshore basins show there are considerable opportunities to make UK production even cleaner,” NSTA reckons.
Commenting on the report, Hedvig Ljungerud, NSTA Director of Strategy, said, “The NSTA will steadfastly hold the sector to account on emissions, including its pledge to halve emissions by 2030, which is the absolute minimum we expect.”
OEUK also weighed in on the emissions report.
The reductions reported for 2022 are in line with the sector’s ambitious commitments under the North Sea Transition Deal, in which the industry committed to reduce emissions by 10 percent by 2025, 25 percent by 2027, 50 percent by 2030, and reach net zero in 2050, the offshore energy sector body noted
Despite the progress, “this is the decade of delivery, not complacency,” OEUK sustainability and policy director Mike Tholen said.
“Our challenge now is to ensure the energy sector receives enough investment and the right long-term energy policy to significantly scale-up the solutions needed to meet the real challenge ahead; halving emissions by 2030 and achieving net zero by 2050,” Tholen added.
In company and field project news, the UK government has approved the development of the Murlach oil and gas field project in the Central North Sea, some 203 km east of the Aberdeenshire coastline and 27 km from the UK / Norway median line.
BP, as operator of the project, proposes to develop the Murlach Field via a two production well subsea tie-back to the Eastern Trough Area Project (ETAP) Central Processing Facility by tying into infrastructure associated with the Seagull and Heron fields (the Heron field has ceased production).
Fluids will be exported via the existing Heron A production flowline to the ETAP CPF where these will be processed before onward export via the Forties Pipeline System and Central Area Transmission System.
The government has also approved proposals for the redevelopment of the Affleck field, discovered in 1975 and located in the UK sector of the North Sea 287 kilometres east-southeast of Aberdeen, and 5 km from the UK/Norway median line.
Operator NEO Energy is proposing to redevelop the field via two existing production wells (A1 and A2), with tie-in to existing riser, flowlines, umbilical and tie-in structures required for the project. The redevelopment is planned to include a subsea tieback to the Harbour Energy operated Judy platform via the Talbot field (proposed by Harbour Energy). On the Judy platform, produced fluids from Affleck and the proposed Talbot development will be commingled with production from other nearby fields that are already operating, and separated into gas and liquids streams for export.
Ithaca Energy announced that it had agreed to buy the remaining 30-percent stake in the Cambo field from Shell, subject to regulatory approval.
A few weeks earlier, Ithaca Energy warned that “While we maintain our 2023 production guidance, due to our continued strong operational performance, it is clear that we, like the rest of the industry, will feel the impact of lower investment on our medium-term production outlook below previously guided levels.”
The company continues to evaluate development options for Cambo, to support submission of a field development application ahead of the associated licence milestone of 31 March 2024, subject to the outcome of the marketing campaign.
Wood and Harbour Energy, the UK’s largest oil and gas producer, have entered into a new strategic partnership for UK North Sea operations in a master services agreement (MSA) and associated contracts valued at around $330 million. Under the agreement, Wood will provide engineering, procurement and construction (EPC) and operations and maintenance (O&M) services, including digital and decarbonisation solutions, for a number of Harbour’s offshore assets. The partnership will run for an initial term of five years, with five one-year extension options covering Harbour’s operated assets, including its J-Area, Greater Britannia Area, Solan and AELE (Armada, Everest, Lomond and Erskine) hubs.
Hartshead Resources and its joint venture partner Rockrose Energy, part of Viaro Group, said that the Gardline Vessel “Ocean Observer” had been mobilised to the Anning and Somerville field locations to commence a survey of the pipeline routing for the gas offtake from the fields. The survey is expected to be completed in early October, subject to any weather downtime.
Hartshead has also received bids for the Engineering, Procurement, Installation and Commissioning (EPIC) contract for the Anning and Somerville platforms. The company will now review each bid prior to providing a recommendation to the JV Operating Committee as to which bidder to award the contract to.
By Tsvetana Paraskova
Investments in Norway’s oil and gas industry are expected to reach a record-high of around 225 billion Norwegian crowns (US$21 billion) this year, as several key projects have been approved in recent years, driven by the country’s temporary tax regime, Rystad Energy said in a new report
Norway’s oil and gas production has declined by nearly 15 percent from its 2004 peak of 4.6 million barrels of oil equivalent per day (boepd), but output is set to rise again in the near to medium term, the independent energy research firm said.
Norway’s oil and gas production might rise towards peak levels by 2025 thanks to increased focus on gas production and new projects. These volumes will be produced with one of the world’s lowest CO2 footprints and reduce Europe’s dependency on Russian fossil fuels, according to Rystad Energy.
Investment levels in the UK have not recovered as they did in Norway, but if the three largest projects – Rosebank, Cambo, and Clair Phase 3 – get final approvals, 2024 could mark the highest sanctioning activity since 2013, with around £9.5 billion (US$12 billion) in future investments, says Sonya Boodoo, senior upstream analyst at Rystad Energy.
Norway’s Ministry of Petroleum and Energy has received applications from 25 companies for the annual APA 2023 licencing round for awards in predefined areas for the best-known exploration areas on the Norwegian shelf.
Equinor, Aker BP, and the Norwegian units of Shell, TotalEnergies, ConocoPhillips, Repsol, and Wintershall Dea, among others, have bid for acreage in this year’s licencing round, the ministry said.
Norway targets to award the production licences in early 2024.
“Without exploration and new discoveries, we will neither be able to maintain the production of oil and gas over time or further develop the petroleum sector and all the jobs in the industry,” Petroleum and Energy Minister Terje Aasland said.
Also in Norway, Equinor and its partners started production from the Statfjord Øst project at the end of August, expecting to increase production by 26 million barrels of oil equivalents.
Two new wells have been drilled from existing subsea templates, and three additional wells will be drilled. Statfjord Øst is tied to the Statfjord C platform, and the project includes a modification on Statfjord C and laying of a new pipeline for gas lift to the subsea wells.
“This proves the importance of extending the life of mature fields and maximizing value creation from existing infrastructure on the Norwegian continental shelf (NCS). The project contributes to extending the life of Statfjord C to 2040,” said Camilla Salthe, Equinor’s senior vice president for Field Life eXtension (FLX).
Increased oil and gas investments and production starts in Norway, the UK’s latest clean energy auction, and a number of renewable energy projects featured in the European energy sector in the past month.
While a record number of renewables projects were awarded government funding in the latest UK Contracts for Difference (CfD) scheme, offshore wind projects did not feature in this year’s allocation.
“While offshore and floating offshore wind do not feature in this year’s allocation, this is in line with similar results in countries including Germany and Spain, as a result of the global rise in inflation and the impact on supply chains which presented challenges for projects participating in this round,” the UK government said.
The industry, however, warned that not a single offshore wind award should serve as a ‘wake-up’ call to the government to restore investor confidence.
After failing to secure any new offshore wind capacity in the latest CfD auction, the UK government has to fix the investment framework through a package of reforms to the scheme, support for supply chains and fiscal measures to attract clean energy investment into the UK in the face of global competition, industry body RenewableUK said Offshore wind projects did not bid into the auction as a result of the maximum price being set too low, the association noted.
“Industry has previously warned that prices needed to rise to reflect the impacts of the invasion of Ukraine, inflation in key commodities like steel, and increased financing costs from spiralling interest rates. However, offshore wind developers saw the maximum price they could bid in this year’s auction cut by £2 to £44 per megawatt hour (MWh),” RenewableUK said.
RenewableUK’s Executive Director for Policy and Engagement, Ana Musat, commented, “Offshore wind remains the UK’s cheapest option for large-scale power, so slowing deployment will cost more and leave consumers exposed to volatile global gas markets for longer.”
The leading offshore industry body OEUK also said that the wind auction was a “clear indicator” the system needs urgent help.
“To deliver the UK’s ambitious wind targets, a policy reform must take place, and we will seek to work with government to revise the investment mechanism, implement proper pricing for generators and reduce the costs of doing business in the North Sea,” OEUK sustainability and policy director Mike Tholen said.
Stephen Wheeler, Managing Director of SSE Renewables, commented,
“While it’s good news lots of new Scottish onshore wind cleared, the fact that no offshore wind projects were bid into this auction round clearly demonstrates the challenges our industry is facing right now from significant headwinds caused by inflationary pressure, commodity price volatility, interest rate raises
and global competition.” Søren Lassen, Head of Offshore Wind Research at Wood Mackenzie, noted that the results of the auction, while not unexpected for offshore wind projects, raised questions about the future of renewable energy in the UK.
“While the current scenario is less than ideal, it may serve as the catalyst the sector needs to recalibrate and move toward a more sustainable future,” Lassen said.
The government should consider raising ceiling prices, streamlining permitting, and introducing non-price criteria, according to WoodMac.
New research by the Net Zero Technology Centre (NZTC) has demonstrated that investment in a purpose-built marine pipeline, the Hydrogen Backbone link, to transport hydrogen from Scotland to Europe could be the key to enabling Scotland to achieve its ambitious green export targets by 2045.
The project, which received funding from the Scottish Government’s Energy Transition Fund (ETF) and match funding from industry, examined the repurposing of existing oil and gas infrastructure before determining that a new purpose-built marine pipeline link to Europe is the optimal route to market for Scotland’s green hydrogen.
The pipeline could enable Scotland to meet up to 10 percent of Europe’s projected hydrogen import demand by the mid-2030s, the report found.
The project has received support from funding partners including Shetland Island Council, EnQuest, Kellas Midstream, Crown Estate Scotland and Shell, contributing members Xodus, DNV-GL, Wood, Wood Mackenzie, and Worley, and strategic partners National Grid and SGN.
The UK target to capture and store 20 – 30 million tonnes per annum (Mtpa) of CO2 by 2030 looks very challenging as some companies are not able to progress projects due to a slowdown in the negotiations for government funding, Wood Mackenzie says, warning that urgent government and private investment would be essential to make a promising policy a success.
To meet its 2030 carbon capture, utilisation and storage (CCUS) targets, the UK must accelerate funding processes and private investment must flow quickly afterwards, while companies must execute transport and storage projects within a compressed schedule, Mhairidh Evans, Head of CCUS Research at Wood Mackenzie, said at Offshore Europe in Aberdeen in early September.
In company news, Equinor officially opened at the end of August the Hywind Tampen wind farm, the world’s largest floating offshore wind farm off Norway.
Hywind Tampen consists of 11 wind turbines based on the floating Hywind concept, developed by Equinor. Hywind Tampen has a system capacity of 88 MW and is expected to cover about 35 percent of the annual need for electricity on the five oil and gas platforms Snorre A and B and Gullfaks A, B and C. Gullfaks and Snorre are the first oil and gas fields in the world to receive power from offshore wind, reducing CO2 emissions, Equinor said.
The Norwegian major also expanded its renewables portfolio in Poland by acquiring a 26-MW onshore wind farm from the Helios Group.
Aker Solutions Subsea and wave energy specialists Mocean Energy have agreed to explore low-carbon solutions that increase the lifetime of brownfield energy infrastructure by using locally generated ocean power to tieback stranded reservoirs.
The two companies will combine their expertise in wave energy conversion and subsea integrated solutions to develop a reliable, cost-effective means of powering subsea infrastructure. The agreement could culminate in the development of a pilot project in UK waters within two years, Aker Solutions Subsea and Mocean Energy said.
“While the current scenario is less than ideal, it may serve as the catalyst the sector needs to recalibrate and move toward a more sustainable future,”Søren Lassen, Head of Offshore Wind Research at Wood Mackenzie
The reinvestment rate of US shale oil producers hit its highest level in three years in the second quarter of 2023, Rystad Energy research showed at the end of August, although the independent research firm warned that the most recent trajectory would not last.
Rystad Energy’s analysis of a peer group of 18 public companies, excluding majors, found that those firms collectively accounted for about 40 percent of total US shale oil output in 2022. That peer group had a reinvestment rate of 72 percent in Q2 2023, up from 58 percent in the first quarter. The second-quarter reinvestment rate was the highest since the 150 percent in the second quarter back in 2020, Rystad Energy’s research showed.
Yet, the trend is expected to reverse by the end of 2023 as inflation eases and global oil prices rise due to tight supply.
“At first glance, a rising reinvestment rate might point to a return to the old days of aggressive capital expenditure and rapid production growth. However, discipline is the name of the game for public shale companies now, which ensures this trend will not last,” said Matthew Bernstein, senior upstream analyst at Rystad Energy.
“As inflationary pressures ease in the coming quarters and oil prices rebound, this spike will be a short-term anomaly instead of a shift of strategy.”
The peer group Rystad Energy has analysed has shrunk due to recent merger and acquisition (M&A) activity and is likely to shrink further as consolidation continues and the number of public upstream companies dwindles.
In one of the most recent deals, Permian Resources has signed an agreement to buy Earthstone Energy in an all-stock deal valued at $4.5 billion, which is expected to create a $14-billion producer in the Delaware basin in the Permian.
“After evaluating over $20 billion of potential transactions during the past twelve months, we firmly believe the acquisition of Earthstone represented the best transaction for Permian Resources. It checks all the boxes, enhancing shareholder value while improving upon an already best-in-class company,” James Walter, Co-CEO of Permian Resources, said.
The latest deal comes after a busy second quarter in which US upstream mergers and acquisitions boomed with $24 billion transacted across 20 deals, and the Permian returned to its usual position at the top of M&A activity, Enverus Intelligence Research (EIR) said in a quarterly report in July.
Permian Resources’ acquisition of Earthstone Energy effectively creates a new member of the US Large E&P peer group, the first addition to that club in quite some time, analysts at Wood Mackenzie said in a commentary
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Mergers and acquisitions in the top oil-producing shale play, reduced areas for federal lease sales, record oil and gas output levels, and higher reinvestment rates in the US shale patch were the highlights in the US oil and gas industry over the past few weeks.
The deal also creates a third pure play Permian producer which will join Pioneer Natural Resources and Diamondback Energy.
“The deal illustrates the pace at which relatively small, nimble companies can quickly combine into a formidable player in the most important basin in the US,” WoodMac said. Moreover, the Permian could have more geologically viable but not yet economically proven inventory, Enverus Intelligence Research (EIR) said in a report at the end of August.
EIR has increased its long-term Permian Basin oil production forecast to sustain production levels until 2040. It also expects dry gas production from geologically viable inventory to add an additional around 2.7 Bcf/d in the Permian in 2030.
“The incremental ~80,000 geologically viable locations across the Permian primarily breaks even between $50 and $70 WTI and will be sufficient to sustain production levels until ~2040 and extend the years of inventory remaining from 17 to 32,” said Stephen Pratt, report author and Permian analyst with EIR.
“Geologically viable but relatively unproven inventory across the Permian Basin will be at the forefront as high-quality drilling locations breaking even below $50 WTI become scarce over the next decade for many operators,” Pratt added.
Texas broke its oil production records in June, July and August—and has increasingly driven US supply, the Texas Oil & Gas Association (TXOGA) said in a report in early September.
TXOGA estimates that Texas produced a record-high 5.5 million barrels per day (bpd) of crude oil in June and July 2023. The association projects that production rose to 5.7 million bpd in August 2023.
Texas accounted for 43.2 percent of US oil production through the first eight months of 2023, which is its highest since at least 1981, the association said. In addition, Texas represented 55.1 percent of US oil drilling in the first eight months of the year, its highest share since 2019.
“Crude oil prices have historically driven drilling activity, and the historical correspondence between prices and drilling has strengthened so far in 2023,” TXOGA said.
In natural gas output, Texas drove the highest share of US natural gas drilling in a decade in August 2023. Texas accounted for 30.7 percent of US natural gas drilling in August, which was the highest share since 2013, according to the association’s estimates.
For August 2023, TXOGA estimates that Texas produced a record 34.1 bcf/d of gross production, including 30.9 bcf/d of marketed production, 26.35 dry gas production, and 3.2 mb/d of natural gas liquids (NGLs).
While Texas and the US are set for record oil and gas production, the industry is criticising the Biden Administration for reducing and cancelling lease sales in federal waters and on federal land.
At the end of August, the Bureau of Ocean Energy Management (BOEM) announced it would hold the Gulf of Mexico Oil and Gas Lease Sale 261 as required by the Inflation Reduction Act of 2022, but with reduced acreage on offer to protect the habitat of a rare whale species. The lease sale will offer 12,395 blocks on approximately 67 million acres on the US Outer Continental Shelf in the Western, Central, and Eastern Planning Areas in the Gulf of Mexico, which would be 9 percent less acreage than the original plan.
The American Petroleum Institute (API), via API Vice President of Upstream Policy, Holly Hopkins, commented on the decision, “With this announcement, the administration is removing approximately 6 million acres of the Gulf of Mexico and adding new and unjustified restrictions on oil and gas vessels operating in this area, amounting to a lease sale in name only.”
“While the Department of the Interior announced a much-needed offshore lease sale today, the Biden administration continues to throw up roadblock after roadblock to American energy production, prioritizing their campaign promise to stop American oil and natural gas development in federal waters over their duty to meet Americans’ energy needs,” Hopkins said in a statement.
API joined with the State of Louisiana and US supermajor Chevron in filing a challenge to BOEM’s decision to reduce the lease area.
“Today we’re taking steps to challenge the Department of the Interior’s unjustified actions to further restrict American energy access in the Gulf of Mexico,” said API Senior Vice President and General Counsel Ryan Meyers. API also condemned the US Administration for cancelling in early September oil and gas leases in the Arctic National Wildlife Refuge (Arctic Refuge) and more in the National Petroleum Reserve in Alaska (NPR-A).
In the Arctic Refuge, Secretary of the Interior Deb Haaland has authorised the cancellation of the remaining seven oil and gas leases issued by the previous administration in the Coastal Plain. The Department of the Interior has also proposed new regulations for the NPR-A that would ensure maximum protection for the more than 13 million acres of Special Areas in the reserve.
The announcement “sets a concerning precedent for the future of oil and natural gas leasing, exploration and production on federal lands. This industry needs clear, consistent policies in place to support the long-term investment needed to produce affordable, reliable energy, but the Biden administration instead continues to send the wrong signals,” API’s Hopkins said
“We urge the administration to stand up for Alaskan communities and the economy by establishing a forward-looking vision for domestic energy production in the state and across the country.”
“At first glance, a rising reinvestment rate might point to a return to the old days of aggressive capital expenditure and rapid production growth."Matthew Bernstein senior upstream analyst at Rystad Energy.
“Today we’re taking steps to challenge the Department of the Interior’s unjustified actions to further restrict American energy access in the Gulf of Mexico”
Ryan Meyers. Senior Vice President & General Counsel API
By Tsvetana Paraskova
Saudi Arabia and Russia, the leaders of the OPEC+ alliance, announced in early September they would extend their respective production and export cuts until the end of 2023.
The extension of Saudi Arabia’s 1 million barrels per day (bpd) cut through December reinforces “the precautionary efforts made by OPEC Plus countries with the aim of supporting the stability and balance of oil markets,” the Kingdom said. The cuts, which mean the Saudis will produce 9 million bpd of crude oil until the end of the year, will be reviewed monthly to consider deepening the cut or increasing production, depending on the state of the market.
Russia also extended its 300,000 bpd export cut into December 2023, with the option to review every month and potentially deepen the cuts or increase supply, depending on the oil market conditions.
While the extension was largely baked in oil prices, the market was not actually expecting a cut for another three months—many analysts had anticipated the cuts would be extended only for October.
The Saudi and Russian moves pushed up international benchmark crude oil prices to their highest level so far this year, with prompt
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September, oil was trading at the highest level in 10 months.
Analysts have not rushed to call $100 per barrel oil yet, although some, including Goldman Sachs, expect that Brent could hit as high as $107 a barrel by the end of 2024 if Saudi Arabia and Russia keep supply off the market for most of next year.
But analysts are unanimous that the oil market will be tighter than previously expected, mostly due to the Saudi production cut of 1 million bpd which comes on top of the cuts several OPEC+ members are implementing until the end of 2024.
The market could be 3.3 million bpd into a deficit in the fourth quarter of 2023, according to estimates by Bloomberg based on OPEC data. If the estimate turns out correct, this would be the largest market deficit since at least 2007.
“These numbers will cause some to question OPEC’s claims that their main objective is to keep the market balanced as their own numbers clearly do not show this,” ING strategists Warren Patterson and Ewa Manthey commented
The extended production and export cuts from OPEC+ leaders Saudi Arabia and Russia, OPEC’s estimate of a large deficit on the oil market in the fourth quarter of 2023, and ADNOC’s new carbon capture project featured in the oil and gas sector in the Middle East this past month.Photo creidt: Reuters
“However, the actual balance could end up looking very different, given that there is still plenty of uncertainty over demand. In addition, we have seen Iranian and Venezuelan output edging higher this year and there is the potential for at least Iranian supply to continue rising despite US sanctions,” ING’s strategists added.
OPEC itself expects global oil demand growth at 2.4 million bpd this year, the organisation said in its latest Monthly Oil Market Report (MOMR) in September. The forecast is unchanged from the estimate of world oil demand growth in August. In 2024, OPEC expects oil demand to grow by another healthy 2.2 million bpd compared to 2023, unchanged from the previous month’s assessment. Developing economies and emerging markets are expected to drive oil demand growth this year and next, led by China, India, the Middle East, and the rest of Asia, according to the cartel.
In terms of non-OPEC supply, OPEC sees growth at 1.6 million bpd in 2023, and further growth of 1.4 million bpd in 2024, with the US, Brazil, Canada, Guyana, Norway, and Kazakhstan leading production gains.
OPEC also noted in its monthly report in September that the global economy held resilient in the first half of 2023 despite various challenges including high inflation, rising interest rates, and geopolitical tensions.
“This steady global economic growth trend continued into 3Q23, supported by buoyant consumer spending, especially in the services sector. With this, the global growth is expected at 2.7% for 2023 and 2.6% for 2024,” OPEC said.
Suggestions that exploration and production of oil and gas should stop represent “a completely irrational view,” Ahmad O. Al-Khowaiter, Executive Vice President Technology & Innovation at Saudi Aramco, said in a speech at the Global Water, Energy, and Climate Change Congress in Bahrain in early September.
“In fact, stopping oil and gas production would do more than just bring transportation and global trade to a grinding halt. It would also derail the very innovation needed to support the world’s transition to a lower-carbon energy future,” Al-Khowaiter said.
“In other words, this is not a zero-sum game.”
The world needs to continue to invest in oil and gas as energy security and affordability are very important amid the various challenges economies have faced in the past three years, he added.
“Accordingly, we believe the energy trilemma of security, affordability and sustainability need to be at the heart of any pragmatic energy transition approach,” Aramco’s executive noted.
“Clearly, different people have different words to describe what they think constitutes a lowercarbon energy transition. Words like equitable, just, inclusive, affordable, stable, and so on,” said Al-Khowaiter.
“But putting aside such semantics, what is also clear is that to truly make meaningful progress towards a lower-carbon energy future, we cannot prematurely limit our options. Rather, we need to embrace a broad portfolio of energy sources and technologies.”
In a sign that Middle Eastern companies are looking to reduce emissions, ADNOC, Abu Dhabi National Oil Company, announced in early September a final investment decision (FID) to develop one of the largest carbon capture projects in the Middle East and North Africa (MENA) region.
The Habshan carbon capture, utilisation and storage (CCUS) project will have the capacity to capture and permanently store 1.5 million tonnes per annum (mtpa) of carbon dioxide (CO2) within geological formations deep underground. The announcement is part of ADNOC’s wider carbon management strategy, which aims to create a unique platform that connects all the sources
of emissions and sequestration sites to accelerate the delivery of ADNOC and the UAE’s decarbonisation goals.
The project is expected to triple ADNOC’s carbon capture capacity to 2.3 mtpa, equivalent to removing more than 500,000 petrol-powered cars from the road per year.
The project will be built, operated, and maintained by ADNOC Gas on behalf of ADNOC and will include carbon capture units at the Habshan gas processing plant, pipeline infrastructure, and a network of wells for CO2 injection.
As part of ADNOC’s ongoing decarbonisation efforts, CO2 will be permanently stored in reservoirs deep in the sub-surface through the deployment of closed-loop CO2 capture and reinjection technology at the well site. The FID to develop the project aligns with ADNOC’s recently announced Net Zero by 2045 ambition and is part of the company’s initial US$15 billion (AED 55 billion) decarbonisation investment in low carbon solutions.
Brent Oil Column October 2023
1 YEAR AGO
Two million fewer barrels of oil were set to be produced each day, equivalent to 2% of global supply, OPEC and Russia agreed. This was an effort to increase prices in countries feeling the heat from the rising energy prices. Prices had dropped to around the $90 mark, down from highs of $120 three months ago.
5 YEARS AGO
There were nearly four-year highs at the start of the month, bolstered by looming U.S. sanctions on Iran’s crude exports, but oil prices posted their biggest monthly drop in more than two years. The price tumbled more than $11 from its highs at the start of the month.
10 YEARS AGO
North sea oil production came under threat after the owners of the Grangemouth refinery and petrochemical plant in Scotland shut part of the site in a move that threatened all 1400 of its employees. The oil produced was a constituent of the Brent Crude price.
By Eric DoyleFrom the advent of the internet to the present day, the relentless wave of digital, technological evolution has reshaped the way we work, revolutionised our very notions of commerce, and fundamentally altered the landscape of modern business.
Artificial Intelligence (AI), it has been part of our lives for decades, running many aspects of our day to day but, it always seemed in the background, something that was super high tech and exclusively scientific.
Now it's in our hands, with a few clicks on our smart devices we can enter into a world we've never had access to before…a world that, in the right hands, can make our business lives easier, more efficient and show us new ideas and concepts.
AI
The first AI programme was presented at the Dartmouth Summer Research Project on Artificial Intelligence in 1956.
AI can see things that we miss. Everything from process improvement, automation, risk management, cost control, research and development…the list goes on.
I think back to the first Social Selling programmes we ran, working with organisational teams who were curious and keen to benefit from all that strategic social media could do for them and at the same time, they were also terrified of being “out there”.
Fast forward to today and it's more widely accepted and understood. We used to run 1 Digital B2B training programme, now have 6.
'An introduction to Digital B2B Influence' to set the scene
‘Digital Influence’ for leadership teams
‘Social Selling’ for sales teams
‘Creating digital demand’ for marketing teams
‘Digital B2B Influence’ for cross functional team
‘Digital advocacy’ for recruitment teams
It’s now becoming clear that bridging the AI gap is crucial to the development of our businesses, here are some key takeaways:
Move now:
Those that adapt quickly and embrace AI will lead the way.
Start
Cut to today, leadership teams around the world and across sectors are grappling with how to secure from, and gain advantage with, the growing and evolving Large Language Models, deep learning algorithms that can perform a huge range of natural language processing tasks, such as SANA AI, Codex, PaLM 2 and ChatGPT.
More and more we are brought into conversations on how AI can assist our clients, and the wider commercial world is also looking forward. According to research firm Frost & Sullivan's "Global State of AI, 2022" report: “87% of organisations believe AI and machine learning will help them grow revenue, boost operational efficiency and improve customer experiences”.
So what are these organisations expecting to find with AI..?
Sit the wider, cross discipline team down and have an open discussion to determine where AI can help you, outsource if you need to.
AI needs large volumes of data to learn and make predictions, it's essential that you have a clear strategy in place before implementing.
The widening accessibility and applicability of AI is a natural evolution of life. Some of the business benefits are known and others are yet to be discovered but one thing is for sure…AI isn't a fad and it isn't going away, and will become more ingrained in our commercial lives. Just like Social Media, those who get a strategic handle on this now, and stick with it while it grows and evolves, will lead the commercial race in their sectors.
“GOOD MEDIA MAKES PEOPLE VISIBLE, GREAT MEDIA MAKES THEM THE LEADERS IN THEIR SECTORS...”Left: Marvin Minsky, Claude Shannon, Ray Solomonoff and other scientists at the Dartmouth Summer Research Project on AI (Photo: Margaret Minsky).
Eni
$11 billion
Saipem has been awarded a contract to deliver SURF for Baleine Phase 2. The scope of work includes the engineering, procurement, construction and installation (EPCI) of approximately 20 kilometres of rigid lines, 10 kilometres of flexible risers and jumpers and 15 kilometres of umbilicals connected to a dedicated floating unit. The installation will be carried out by Saipem’s construction vessels and will take place in 2024.
One-Dyas
$482 million
Global Maritime has been contracted to provide marine warranty surveyor services. Global Maritime will perform a third-party document review and onsite surveillance throughout the mobilisation, transport and installation phases.
$600 million Energean reported that the field development plan for Katlan was submitted to the Israeli government in August and is currently awaiting approval. Energean has stated that they are getting ready for the approval of a final investment decision for the Katlan development project in Israel later in 2023.
Aker BP
$2 billion
MAN Energy Solutions has been contracted to supply seven compressor units for the Hugin A and Munin production platforms in the Yggdrasil area and at the new production and wellhead platform (PWP) in the Valhall field centre. Regarding Valhall, MAN is responsible for providing one tandem HOFIM compression unit for gas export.
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Total E&P Angola
$200 million
Oceaneering has been awarded a contract by TechnipFMC to assist with transportation and installation work. The scope of work includes air and saturation diving, project management, engineering, and procurement services in support of the TechnipFMC's recovery and replacement of 12 risers. Oceaneering is expected to provide services with Angolan personnel throughout the project's lifespan, which will begin in late 2023 and end in late 2025.
BP
$10 billion
Tiber could enter the concept selection stage later in 2023, dependent on the success of the Kaskida project. The project is included in BP's plans of producing 300,000 barrels per day of oil from the US GoM through to 2030.
Saudi Aramco
$9 billion
NPCC has awarded Lamprell the contract to fabricate five offshore jackets for the Zuluf field. The scope of work also include the option to supply and fabricate grillage and sea-fastening of structures. Synectics has been awarded a contract to supply specialist camera stations for the project.
$7.2 billion
Mexico's National Hydrocarbon Commission (CNH) has approved Trion's development plan. The decision will allow Woodside to progress into execution phase activities with selected contractors. Woodside has selected SBM to execute the installation of the FPU and of the FSO, whilst OneSubsea is to deliver the subsea trees to Trion.
Conrad Petroleum
$303 million
Conrad Petroleum has launched a prequalification tender on the provision of drilling rig service. The workscope will be for drilling service for five development wells + one development well (optional) at Duyung Block, Natuna Sea, and two 2 commitment wells in another block. The work is targeted to commence in 2025 and pre-qualification submission will be due on 22 September 2023.
Petronas
$800 million
Petronas has launched the pre-qualification exercise for the Engineering, Procurement, Construction, Installation and Commissioning (EPCIC) of gas export pipeline for the Kelidang cluster development project.
ONGC
$300 million
ONGC has commenced the EPC tender process for the project which will comprise of three 6-slot wellhead platforms with gas lift facilities, along with 110km of associated subsea pipelines, modifications at existing platforms along with an extension of a flare bridge. Bids are due on 5 October.
Trident Energy
$100 million
Trident Energy has signed RRC Tecnologia e Inovação, part of the Bravante Group, to execute consultancy works related to the decommissioning of 800km of flexible pipelines and other subsea equipment at PampoEnchova under a one-year contract. The company will carry out a technical/operational consultancy for the removal of the equipment that used to be connected to the P-07, P-12 and P-15 decommissioned semisubmersible platforms.
By Tsvetana Paraskova
Energy security and the energy transition are driving increased investments in both the oil and gas industry and the renewables sector this year. Oil and gas supermajors are doubling down on fossil fuels, some of them retracting previous plans to curb oil and gas output and betting on core areas and new frontiers for more supply to meet today’s energy needs.
With fossil fuels still accounting for around 80 percent of the total global energy consumption, the national oil companies of the top Middle Eastern producers are looking to boost production capacity this decade. Meanwhile, international oil firms, or integrated energy companies as they prefer to be referred to these days, continue to invest in stable oil and gas supply, not excluding fossil fuels from their growth plans despite pressure from environmental campaigners and environmentally-conscious investors.
Investment in oil and gas is expected to increase by 7 percent in 2023 to more than US$500 billion, bringing the amount back to the levels of 2019, before the pandemic hit global fossil fuel investments. However, around half of this year’s increase in investments is likely to be absorbed by cost inflation, the International Energy Agency (IEA) said in its World Energy Investment 2023 report
“Many large oil and gas companies have announced higher spending plans on the back of record revenues. But uncertainties over longer term demand, worries about costs, and pressure from many investors and owners to focus on returns rather than production growth mean only large Middle Eastern national oil companies are spending much more in 2023 than they did in 2022, and they are the only subset of the industry spending more than pre-pandemic levels,” the agency noted.
International companies are also spending more on new oil and gas projects, from Norway to Guyana. Moreover, the reduction in Russian pipeline gas deliveries to Europe has led to an increase in investment in alternative sources of gas supply and in LNG infrastructure.
At the same time, the energy crisis of 2022 and energy security issues following the Russian invasion of Ukraine are driving up investments in renewable energy. Around US$2.8 trillion is set to be invested globally in energy in 2023, of which more than US$1.7 trillion is expected to go to clean technologies, including renewables, electric vehicles, nuclear power, grids, storage, low-emissions fuels, efficiency improvements, and heat pumps, the IEA’s report said. The rest of the investment, at slightly more than US$1 trillion, is expected to go to coal, gas, and oil.
“For every dollar invested in fossil fuels, about 1.7 dollars are now going into clean energy. Five years ago, this ratio was one-to-one,” IEA Executive Director Fatih Birol said in comments on the report.
“One shining example is investment in solar, which is set to overtake the amount of investment going into oil production for the first time,” Birol noted.
In a separate report from June this year, the IEA estimated that renewable energy capacity additions will see the largest-ever increase this year, driven by Europe’s energy crisis, the Inflation Reduction Act
(IRA) in the United States, and the strong expansion of green energy installations in China.
Global renewable capacity additions are set to soar by 107 gigawatts (GW), the largest absolute increase ever, to more than 440 GW in 2023, the agency said. Solar PV capacity, including large utility-scale and small distributed systems, is expected to account for two-thirds of this year’s projected increase in global renewable capacity, according to the IEA’s Renewable Energy Market Update with outlook for 2023 and 2024.
“The energy crisis has turbocharged demand for both large-scale plants & rooftop solar,” the IEA’s Birol said
While growth in renewables gains momentum, the oil and gas industry is reversing the downward trend in investments from the past three years since the onset of the pandemic, with more overall spending on expansion and development of projects.
Companies operating in Africa, such as Italy’s Eni, are betting on offshore gas projects to boost their LNG supply to the international market, especially the European gas market now that Russia has cut most of its pipeline gas supply to many EU countries.
Eni, for example, shipped at the end of last year Mozambique’s first LNG produced from the Coral gas field, in the ultra-deep waters of the Rovuma Basin, from Coral Sul Floating Liquefied Natural Gas (FLNG) facility.
“The first shipment of LNG from Coral South project, and from Mozambique, is a new and significant step forward in Eni’s strategy to leverage gas as a source that can contribute in a significant way to Europe’s energy security, also through the increasing diversification of supplies, while also supporting a just and sustainable transition,” Eni CEO Claudio Descalzi said at the time.
More recently, Eni began in August 2023 oil and gas production from an offshore field in Cote d’Ivoire in West Africa less than two years after the discovery.
In the Middle East, the biggest national oil firms, Saudi Aramco and Abu Dhabi’s ADNOC, are investing in ramping up the oil production capacity in Saudi Arabia and the United Arab Emirates (UAE), respectively.
ADNOC has been accelerating plans to raise its oil production capacity to 5 million bpd from 4 million bpd now, but it is also looking to decarbonise part of its operations with the use of grid energy from renewables and nuclear generation to power onshore operations. The Abu Dhabi firm has also recently announced it was bringing forward its target for net-zero emissions to 2045, from a previous target of 2050, becoming the first oil company in its peer group to commit to net zero in 2045.
In Saudi Arabia, Aramco is working to increase its crude oil production capacity to 13 million bpd by 2027 from 12 million bpd currently.
Among producers outside the OPEC+ alliance, Brazil hit in July a record-high oil and gas production of 4.48 million barrels of oil equivalent per day, with the pre-salt offshore area contributing 75 percent to the total output.
In Europe, “Norway and the UK have overcome recent challenges and are on course to achieve
significant milestones due to notable increases in investments, exploration success and production,” Rystad Energy said in a report in early September.
Investments in Norway's oil and gas industry are expected to reach a record-high of about 225 billion Norwegian crowns (US$21 billion) this year, as several key projects have been approved in recent years, driven by the country’s temporary tax regime.
“By 2025, production might rise back towards peak levels as a result of increased focus on gas production and new projects in the pipeline,” the independent energy research firm said.
In the UK, investments are set to be around 75 percent lower than 2013, when investment peaked at nearly £18 billion (US$22.7 billion), according to Rystad Energy.
But the research firm noted that “With many developments in the pipeline, however, next year could see the highest number of projects sanctioned in a decade.”
“The three largest projects are Rosebank, Cambo and Clair Phase 3. If these major projects get approved, 2024 could mark the highest sanctioning activity since 2013, with around £9.5 billion ($12 billion) in future investments,” said Sonya Boodoo, senior upstream analyst at Rystad Energy.
In the US, crude oil and natural gas production is set to rise to a record this year and next, with output growth so far defying sceptical projections from last year and earlier this year. Many US majors and independents reported record second-quarter output in the Permian basin, and some of those raised their production guidance for full-year 2023.
Overall, the energy industry is investing in growth, as energy security and the energy transition drive up spending on projects in oil and gas as well as in renewable power capacity.
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UK Well Operator, Exceed, which has grown to be the largest independent well & reservoir management specialist, is trusted by the world’s leading operators and suppliers to provide integrated well management solutions across a rapidly evolving global energy landscape.
Announcing in August that it expects to see record-breaking revenues for the current financial year, the company continues to illustrate the criticality of its capabilities in leading a sustainable energy transition. Currently acting as Well Operator for four clients, it will report an annual revenue in the region of £30million, much of which can be attributed to its ground-breaking work towards decarbonisation.
Exceed’s pragmatic approach to well & reservoir management has been developed to address the energy trilemma of security, affordability and sustainable decarbonisation. It achieves this not only through decommissioning, reuse and repurpose, but also through the application of its world-renowned well engineering and drilling capabilities, which follow a strategy to eliminate or reduce each project’s direct emissions.
Exceed is justifiably proud of the role it plays in this respect, achieved whilst it continues to support the global production industry, with well operations currently taking place across seven countries.
Maximising clients’ economic recovery factor plays a critical role in ensuring the sustainable global energy transition to which Exceed is 100% committed. This includes the recent award of two major global well engineering and managed pressure drilling framework agreements, and deepwater operations in frontier producing regions including Namibia, Romania and Guinea Bissau.
Where possible, carbon offset well operations are deployed in conjunction with processes for the reduction of fuel consumption throughout the supply chain. CO2 reduction is also achieved through design, contract incentivisation strategies, logistic optimisations and a carbon reduction focus on technology and product selection.
Exceed’s people are the company’s most valuable asset, and it is passionate about securing the future of an enthused and motivated “next generation” of energy professionals. It has gained a reputation for nurturing innovative minds, and those minds have been the driving force behind the technical and commercial activity which keeps Exceed at the forefront of a developing energy industry.
Across Exceed’s service lines, its workforce of over 150 is responsible for introducing several “industry firsts” – from unique decommissioning subsea well access technologies and the contracting methodologies which incentivise decarbonisation, to supporting clients as they enter frontier exploration regions across the globe.
This is an exciting journey to be a part of and Exceed ensures it’s attracting the very brightest talent available; not only by creating some of the industry’s most compelling career opportunities through a robust strategy of diversification and internationalisation, but also through a competence management system and a programme of investment in people which reflects Exceed’s consistent sense of duty in helping its employees achieve their professional development goals.
This year, Exceed is underlining its commitment to partnering and industry collaboration, as the joint Principal Sponsor of the renowned Offshore Achievement Awards. In doing so, the company is not only promoting the outstanding work undertaken across the industry, it’s also highlighting the sheer range of long-term career opportunities available across countless energy disciplines – not just engineering.
An important message, and one which reflects all Exceed stands for as it continues to lead a sustainable energy transformation.
Leading oilfield casing accessory and completion equipment manufacturer announces it has opened a new Middle East regional headquarters in Dubai, UAE. It will not only house new staff but hold local inventory making it easier for clients to access.
Newland Oiltools, headquartered in Houston, USA, focuses on the research, development, production and supply of high-quality downhole cementing products. The company was formed in 2006 by Bexing Wang, President and CEO of this fast-growing company, who has had oversight of this rapid growth as a manufacturer and supplier. David Lee has been involved since the company’s inception, who has played a major role as part of the Newland management team. They now have more than 200 employees and is the largest manufacturer of centralizers, float equipment and cable clamps in Asia, already operating in more than 50 countries, spanning 6 continents.
The commitment to excellent quality has earned them a reputation as one of the best suppliers in the global market. And they proudly declare that the products have been supplied for 17 years with zero failure. With a keen emphasis on R&D and a lean manufacturing philosophy, the team at Newland are always looking for ways to reduce manufacturing and design costs, to pass on more cost-effective solutions to clients. One design doesn’t fit all, so the team are always listening to client requests to create bespoke design solutions even for the most problematic wellbores. With the main manufacturing plant working at an increased capacity, the team are already looking for an additional manufacturing location in Southeast Asia or Middle East location.
Vice President Jason Kent leads the western hemisphere operations from the Houston office, himself being very experienced in the oilfield marketplace, driving the business strategy across the mainland USA and into South America. Expanding the US team with newly appointed Daniel Howard, who comes with wealth of experience and will be a great asset to drive the development in the area.
The opening of the new office marks a significant milestone for the company, as the organization continues to expand its presence in the Middle East. Newland Oiltools have been supplying in the region for more than 15 years, but never directly to clients, always via a third party, but due to strong customer demand for its products and services prompted the move to setup its own base. Timing is everything with Newland, recently being approved as an ADNOC approved manufacturer, which gives a great platform to build on for the future.
Spearheading the expansion in the Middle East is Vice President Martin Pirie, who has been working in the region for some 16 years, supplying Newland Equipment for his previous employer, so has great experience of the company’s equipment and capabilities. Having a proven track record of delivering growth in these markets, Martin is eagerly looking to further establish Newland ‘s footprint and physical presence in the MENA and Caspian Regions. He says of the expansion, "We are bringing our industry-leading knowledge, expertise, and first-class equipment to market, for ease of accessibility for our clients, by strategically creating hubs in key logistical areas. Operators and service companies have used our equipment for many years, unaware that it was branded with another name, so It’s just about informing people, new name, but a long established supplier in the region to all the major operators, such as Aramco, KOC, ADNOC and BP Azerbaijan to name a few.
The UAE office won’t be the only physical location they will have, as work is already underway to create a local base in Baku, Azerbaijan. This facility will service operators throughout the Caspian region and will be offering a “one of a kind” testing facility for casing centralisers that will offer API and beyond testing parameters. Martin Pirie said “To open not just a new entity but provide a testing facility specifically for centralisers is unprecedented. We, as a manufacturer, are taking the initiative to allow operators to test their current or new equipment and get accurate performance data. There is a lot of misinformation in the industry, this will confirm actual data and give operators full confidence in their supplier”.
When PetroVietnam sought to ensure the integrity of their flexible pipe risers and flowlines, The Impulse Group was an international partner they could trust.
With over two decades of experience in flexible pipe annulus testing, our engineers were able to rapidly deploy our state of the art mobile annulus test kit and an engineer to the field. We were able to quickly and efficiently perform routine testing and visual inspections to determine the integrity and safety of their flexible pipes.
Gilles Gardner, Engineering Director, said, “We were able to be responsive for PETROVIETNAM, providing them with actionable insight and key indicators on the health of some of their more important assets in the production system.”
The Impulse Group determined from the testing that the riser outer sheath was intact, recommendations for frequency of future testing were adopted by the client based on factors such as the operating conditions, pipe age, and service life.
gas platform to the FSO, which had been put into production from 2011. The Impulse Group offered their professional services from the very beginning of the project. The team were friendly, knowledgeable, and showed their competency. The job was carried out successfully and safely as planned, despite extreme weather. We look forward to working with The Impulse Group again on our future projects.”
The Impulse Group offers a range of services for the oil, gas and energy industries, including asset integrity management, project delivery, 3rd party inspection and testing of flexible products. Our team of experienced engineers and technicians can help minimise risks
and extend the lifespan of your operations, increasing efficiency and maximising output. We provide support during the pre-FEED, design and manufacturing phases to ensure projects are completed on time and within budget. We offer in-house or remote training on flexible product technology, as well as a variety of specialised components, such as repair systems, clamps, bend restrictors, and centralisers, to support your projects.
The Impulse Group employs over twenty people with a combined 135 years of experience with flexible pipe products. We have bases in Morpeth and Aberdeen supporting clients in Norway, Canada, Denmark, Malaysia, Nigeria, Ghana, Vietnam and India.
During inspection, some of the annulus vent valves were discovered to have been painted over and fouled, they were cleaned, recondition, re-tested and returned to operation.
This solution helped PETROVIETNAM save time and money by reducing the number of unnecessary inspections while maintaining safety standards throughout operations at the Bien Dong field.
Sam Ha, Project Manager and PETROVIETNAM Integrity Duty holder Kim Thiet Production Trading Services Co., Ltd. “The scope of work was to perform the annulus testing for three flexible risers (~ 2km), from an MT1
2-5 October 2023
The innovative UK multi-disciplined engineering firm secured contracts with 31 companies in 17 countries for its screw conveyors in the past three months.
Projects include new screw conveyors and the manufacturing of essential replacement parts for change-outs, including its proprietary dualdrive system.
JBS manufactures and supplies dual drive screw conveyors to energy service firms for operations in the UK, Europe, Brazil, USA, South-East Asia and the Middle East. This forms part of four key JBS service propositions – screw conveyors, subsea excavation, engineering and fabrication and blast containment solutions.
The JBS acquisition of Screw Conveyors Ltd five years ago means it has a 20-year database of equipment and technical information. In addition, JBS are a Martin Sprocket authorised distributor and a Nord Drive Systems stockist. Jo McIntosh, sales and marketing director at JBS, said: “Our knowledge of client systems sets us apart from others in the market. We have seen an increase in demand for our screw conveyors across the globe and are confident of additional orders from Middle East companies. Our screw conveyor partnership with Martin Sprocket provides genuine original equipment manufacturer (OEM) parts to screw conveyor users. This is just one example of the type of support we can offer companies across multiple sectors.
JBS Group is executing a series of contract wins worth £2.6m for its Sea Axe technology.
The company is undertaking – or has already completed – several projects in the UK and internationally with the patented solution which enables fast, largescale controlled flow excavation.
Sea Axe was used on the world’s longest interconnector project - subsea and on land. The £600 million project to connect Denmark and the UK, included the turn-key design, manufacture and installation of 1,250km of subsea cable and 135km of land cables on the UK side.
The programmes of work also include recent support for a global engineering contractor performing reburial work as part of a decommissioning project in the North Sea.
For another global firm – this time in Australia – Sea Axe is providing a means of access for cut and recovery to be made as part of a broader decommissioning project.
JBS is also using Sea Axe in the provision of excavation support for two significant projects. For both projects, JBS is working a shift system to provide 24-hour support and delivery.
Another client brought in the JBS team and Sea Axe for an excavation project at a Scottish port. All contracts have been secured in the past four months.
Sea Axe is the most environmentally friendly system of its type on the market, and its comparatively small spread minimises deck
“ADIPEC is a very important exhibition for us and a great opportunity to showcase our broad range of solutions. We have ambitious plans for growth and our presence at ADIPEC will help us to achieve our goals.”
In addition, JBS delivers fabrication projects for operators and energy service firms. Work has included flying lead deployment frames and several other large-scale fabrication workscopes for long-standing clients. More than 60% of JBS Group’s sales come from international markets, with the firm trading in over 80 countries – a key factor in its success in the Going Global category at the 2023 Northern Star Business Awards in Aberdeen. The awards are organised by Aberdeen & Grampian Chamber of Commerce. JBS is based at South View, Dales Industrial Estate, Peterhead.
space requirements. It can also be safely deployed from a vessel’s A-frame or crane. Jo McIntosh, sales and marketing director at JBS, said: “There has been rapid market recognition of the Sea Axe – a cuttingedge solution that has many advantages in terms of efficiency, cost-effectiveness and environmental sustainability. We’re extremely proud to have worked on the record-breaking project.
“We are on track for growth as our relationships with clients develop and they gain a deeper understanding of how we can help to optimise their operations.”
Sea Axe can be used for a range of scopes, including pipe/cable projects, seabed preparation, salvage and recovery, inspection, maintenance and repair (IMR), decommissioning, power plant outlet pipes, unexploded ordnance clearing, harbour clearance, and subsea and windfarm structure projects.
Previously, JBS supplied a Sea Axe MFE system complete with operational team for a pipeline burial project offshore Bangladesh. This version of the system included an electric HPU (hydraulic power unit).
Destec Engineering has specialised in the manufacture of high pressure Flanges, Seals & Connectors for the Oil, Gas & Renewable Energy Industries for over 50 years.
PRODUCTS WE DELIVER:
— Destec Compact Flanges
— DESALIGN Misalignment Flange
— G-Range 4 Bolt Connectors
— Compatible Seals
— GSB Subsea Single Bolt Clamps
SERVICES WE OFFER:
— On-Site Machining
— Bolt Tensioning
— Special Purpose Machine Tools
— Laser Alignment Services
— NDT Services
— Regenerator & Vessel Head Removal
T: +44 (0) 1522 791 721
F: +44 (0) 1522 790 033 service@destec.co.uk
sales@destec.co.uk
WWW.DESTEC.CO.UK
AISUS, the expert in remote inspection technology and services, returns to ADIPEC following a year which has seen the company treble its turnover, double its headcount and continue to grow its international footprint.
AISUS’ company-owned suite of technology is designed to solve integrity challenges across topside, substructure and subsea infrastructure. Through deployment of its technologies, AISUS provides robust real-time inspection data and footage which improves the safety, cost, efficiency and environmental impact of any asset. The outstanding accuracy and scale of data collected by its tools also allows for predictive modelling which will enhance maintenance, performance and issue identification strategies.
Together with AISUS’ highly-specialised inspection team, that technology is deployed across an established global market in locations as varied as Australia, Qatar, Europe and the Americas. Augmenting that list, 2023 has seen the company enter the UAE for the first time, providing offshore inspection services to an NOC.
Currently undertaking internal inspection of caissons, the company’s inaugural workscope in the region applies a number of AISUS key
services including visual inspection, wall thickness mapping and 360° videoing, with technicians in-country.
AISUS is also flexing its innovative muscles in the region, working closely with another client on the application of Rapid-X; a uniquely high-speed X-ray acquisition system designed for the inspection of spooled and continuous lengths of complex offshore and onshore components. Efficient, accurate inspection tracks liability of an asset’s integrity, postmanufacture - in this instance unbonded flexibles.
Summing up AISUS’ return to ADIPEC, Barry Marshall, General Manager discusses the company’s entrance into the UAE market, during a year of unprecedented commercial success for the company:
“This is a real case of breaking ground for AISUS. The UAE is a new region for us, we’re working with new customers, and we’re providing a service that was previously unavailable to them.
“Growth in this region will be core to our future development and we’re pleased with the results of our initial activity. If that growth continues as confidently predicted, we will shortly elevate our existing regional service in terms of establishing a permanent presence and providing the flexibility and turnaround associated with AISUS, whilst developing a local workforce.
“There is no doubt that our presence at ADIPEC 2022 was instrumental in establishing the relationships which led to current AISUS operations in the region. This year, we’re back to cement those relationships and develop new connections with a view to establishing a formal in-country partnership.
“These are exciting times for AISUS as we continue to blaze a trail in the remote inspection field. We’re delighted to be back in Abu Dhabi, discussing what we do best; the provision of genuinely marketing-leading inspection services and technologies which extend across the production lifecycle, into late life and decommissioning.”
Holistic service support is about building relationships and that comes from a foundation where trust and reassurance are in place. A client’s decision-makers want to know they can stay ahead of potential issues wherever they might arise. One of our strengths is being able to draw on our OEM agnostic positioning, where, due to our own installed base of legacy brands throughout the Middle East, we are not fazed by maintaining any type of equipment.
Our methodology is always “refurbish, before replace” to reduce waste, limit carbon footprints and to save time and costs, but if that isn’t possible, we have the bandwidth of skills to manufacture new components if necessary.
Manufacturing is intrinsic to augmenting the traditional service model and it is unquestionably critical when regeneration is not an option. New builds represent an extremely price competitive arena, particularly in the Middle East, so over the past year we have been working, as a global team, to further optimise our procedures around bidding, engineering, and supply chain, alongside our colleagues based in Chennai, to deliver cost effective manufacturing to other parts of our worldwide organisation. This enables us to tender for, and win, more opportunities and as a consequence gain additional activity for our service and trading arms over time.
Over the past 20 years, much of the Arabian Gulf has become a focal point for rapid change and innovation, reflected in everything from skylines to core infrastructure. The energy industry has certainly been no different, spurred by the rapidly changing backdrop of the transition and price fluctuations, where enhanced efficiencies, maximising life and the digital oilfield have all steered strategy over time.
Service provision sits at the crossroads of traditional support models and pushing into new digital technologies. The need to be able to think creatively, have a broad portfolio of solutions at your disposal and to deliver those with value and quality are core necessities, yet always being attuned to market needs, anticipating them, and reaching for new offerings define a successful and forwardthinking operation.
No matter what might be required by a client, whether physical intervention by technicians or devising a joined-up maintenance and asset management system, time is always of the essence as equipment is either in need of immediate repair or critically exposed to potential failure when processes need simplifying and optimising. If a service team has a long-standing and extensive presence in the region, that gives it an extra ability to be nimble and agile.
At Proserv, when delivery times are critical, we can leverage support from colleagues in Dubai, Dammam, Doha or Abu Dhabi to smoothly segue into priority projects to make sure we hit targets and to give the reassurance that is so valued by customers. But it doesn’t stop there. An effective service operation also needs an agility, and capability, to innovate the solution that works best for any specific situation.
The way we do that is via the range of our expertise. On one hand, being able to stay close to our clients, tapping into local knowledge, aware of the challenges of remote locations and extreme conditions, and getting boots on the ground in a few hours if required. But on the other, having the technologies and domain knowledge to bring valuable predictability to maintenance scheduling, performance and production, through asset and infrastructure management tools and real-time monitoring applications.
Bandwidth and reach
Proserv’s global service business extends to the North Sea and the Gulf of Mexico and so we take a worldwide perspective on our offering, harnessing skills and know-how from other parts of our company, including our digital team and offshore wind, to bring additional value to clients.
For any forward-thinking service business, it is imperative to reflect the current direction of the market. Anyone who follows Proserv closely will have seen the technology roadmap we have been on over the past few years, as we build data analytics and intelligence solutions to provide real-time monitoring and insights across the energy sector, designed to optimise performance and give visibility and further clarity to operations.
That same approach has been transposed to our service provision. We already know we have the depth of traditional skills to build, test, react and repair at speed. But the value we can bring via our digital offering and holistic asset and infrastructure management, whether through providing simplification of maintenance planning and obsolescence management, or the potential for remote realtime monitoring, will not only enhance and extend our relationships with clients but be transformative to their day-to-day processes. This model is front and centre of effective service support and key to Proserv’s strategy in the Middle East and across the globe. As the region’s energy mix diversifies, our next exciting challenge will be to identify more openings where we can take these highly transferable yet impactful technologies into new areas.
Proserv’s Nicola Birnie, GM, Dubai and Chris Chambers, GM, Saudi Arabia pinpoint key strengths and capabilities required to drive a forward-thinking business.Providing leading controls technologies to enhance performance, optimise assets and extend life right across the energy sector. For more information, see our website: proserv.com Nicola Birnie, GM, Dubai, Proserv Chris Chambers, GM, Saudi Arabia, Proserv Proserv's facility in Dammam, Saudi Arabia
With over 17 years as a leader in the supply of flowline, inspection, and wellhead services, an innovative Northeast company is setting up in the Middle East
Based in Lunan near Montrose and Westhill, Intervention Rentals have been at the forefront of supporting the energy sector by providing flowline equipment, wellhead services, as well as best in class calibration & measurement provision. The company has branched out in to iron management to fully embrace a circular economy philosophy to ensure they are leading the way in sustainable services.
Phil Scott, Managing Director, has been leading the way with expansion plans for the firm. “We are excited to announce that we have opened Intervention Oilfield Equipment Rentals LLC in Abu Dhabi. We have several existing clients in the region, that we have worked with for many years in other countries, and we knew the time was right to expand out here”. In addition to the UAE opening, Intervention Rentals has created a partnership in Saudi Arabia with Gulftek Arabia. “To have such a well known and respected partner as Gulftek allows us to provide our innovative, sustainable and cost reduction management to our key clients in the Kingdom” continues Phil. “The main service we will be providing is our Iron Management service. It is designed to dramatically cut down on fuel & logistics because of how we store, recertify, service and manage our customers equipment using cutting edge inventory and service management software. This has two benefits for our customers, it dramatically reduces cost and time of operations and by planning and managing logistic & kit for our clients we have provided them, and us, a sustainable and low carbon solution.
Joining Phil in the Middle East leadership is Mourhaf Jabri as Region Manager. “This is a very exciting time for the company to make these commitments to our clients in this region. By focussing on how we work as an outsourced iron & flowline division for our clients we can drive down day to day operational costs and dramatically reduce capital expenditure.
Not only can we provide a range of flowline and wellhead rental and service packages, but we are also aggressively ensuring we are the most sustainable supply partner we can be to make sure our clients greenhouse gas emissions plans are met”.
Intervention Rentals are sponsoring 3 holes at the OGV golf day at Yas Links in Abu Dhabi on October the 1st, and look forward to catching up with everyone during ADIPEC.
For more information visit www.interventionrentals.com
“We are excited to announce that we have opened Intervention Oilfield Equipment Rentals LLC in Abu Dhabi."
With nearly 50 years’ experience in the energy industry, Petrasco is a specialist provider of international logistics solutions including air, sea and road freight services.
Petrasco can trace its roots back to the formative years of North Sea oil. Since opening its Dyce headquarters in 1974, the company continues to evolve and possesses a global outlook with operations in the three major energy hubs of Aberdeen, Houston and 20 years in Dubai.
A global outlook with deep connections to the north-east of Scotland means Petrasco is trusted by firms entering new markets or expanding global operations for oil and gas and renewables activity. This is testament to its team’s unrivalled experience in energy sector logistics and their commitment to keeping vital supply chains moving worldwide.
Part of Denholm Energy Services, Petrasco retains the strength of local, on-the-spot decision making. It supports clients by providing access to the right equipment and allowing them to mobilise quickly and cost-effectively overseas.
Through its international hubs, Petrasco supports energy companies by providing:
• International logistics services
• 3PL supply base and storage (primary or overflow)
• Inventory management
• Packing solutions
• Access to technical and manpower services
• Introduction to network of support services
With the UK Net Zero targets clearly set by the North Sea Transition Deal, as launched in March 2021, the drive to clean energy through progressive improvement has commenced strongly across the sector. Worley recognise the importance of solutions that consider the expanding range and magnitude of various renewable power sources; specifically, how their integration with oil and gas assets can reduce and even remove the traditional means of local hydrocarbon-based power generation.
“Through the collaboration with Worley, we are proud to support the energy transition with yet another electrification project taking it one step further with our subsea transformer technology, says Gunnar Lie, Head of Project Delivery – Subsea and New Energy, ABB Norway. The combination of automation and electrification is the key to reducing carbon emissions in the oil and gas sector.”
This technology as part of an integrated design is an outstanding solution to the offshore decarbonisation issue, with offshore power generation being the primary source of asset CO2 emissions. Providing real solutions for real issues, with best market technology is why Worley are demonstrating outstanding progress in the path to Energy Decarbonisation.
Worley’s attitude and drive to real transition is clearly demonstrated within Ithaca’s Captain Electrification project, which Worley are leading as primary FEED contractor. This would see the partial electrification of the Captain asset, with primary power being provided from renewable sources onshore, transmitted to the Captain field at 132kV and stepped down locally for connection to the asset at 11kV. The project becoming wholly more viable through revolutionary subsea high-power technology, developed by one of the world’s premier power system providers (ABB) and introduced by Worley to the Captain project in the Pre-FEED stage. This Worley led collaboration with ABB and Subsea7, now progressing through FEED sees the implementation of emergent high power subsea transformer technology. The removal of this single item from the topside structure to the seabed brings a significant reduction in topsides impact and thereby project cost, offshore labour and risk profile; plus, the major reduction of multiple and prolonged impositions to live asset operations.
Dr Kirsten Oliver, VP, Energy Offshore Worley commented “What excites us most is seeing collaboration and partnership across the industry and greater speed in innovation. The need to think differently has meant that we’re being more creative, which is leading to new and exciting outcomes.”
Alan Bruce ,CEO Ithaca commented “We are pleased to partner with Worley to evaluate the potential for electrification at our flagship Captain field. The electrification project requires complex solutions to a number of challenges and our partnership with Worley allows us to benefit from the power of collaboration, harnessing the collective talent of both the Ithaca Energy and Worley teams.”
Over the years we’ve witnessed lots of change. But nothing we’ve previously seen compares to the great changes our industry faces today: the energy transition.
www.leyton.com
Leyton is an international consulting firm that helps businesses leverage financial nondilutive incentives to accelerate their growth and achieve long lasting performance.
We simplify your access to these complex incentives. Our combined teams of highly skilled Tax and Technical specialists, enhanced with cutting-edge digital tools developed internally, maximise the financial benefits for any type of businesses.
With compliance always front of mind, we have been delivering optimal services for our clients for over 24 years. This provides peace of mind that you will always receive the maximum benefit, without taking risks.
In the fast-paced world of the UK Energy Sector, international growth isn't merely a choice—it's a strategic necessity. As we explore the landscape of this dynamic sector, we discover an exciting story of innovation and global expansion.
Innovation is the lifeblood of the UK energy as industry, propelling it into new territories. Pioneering technologies and forwardthinking approaches have become the bedrock of international expansion. This industry, like many others, has recognised that continuous improvement is essential for success. By adopting cutting-edge drilling technologies, companies have not only increased efficiency but also reduced operational costs. Innovations in directional drilling systems, for example, have played a pivotal role in facilitating international market penetration.
The world is changing, and with it, so is the energy landscape. In response, the UK is embracing sustainability as a core principle. Sustainable exploration techniques, including carbon capture and storage, are not just lowering the industry's carbon footprint; they are also fostering international collaborations centered on green energy solutions. Collaboration is the cornerstone of international growth in this sector. By forming strategic partnerships with international counterparts, the UK industry is creating a synergy of knowledge, technology, and resources. These alliances are instrumental in expanding its global presence.
While the path to international growth is fraught with challenges— geopolitical uncertainties, market fluctuations, and environmental concerns—the industry remains resolute in its pursuit of innovation. These challenges, far from deterring progress, serve as catalysts for innovation and evolution.
The UK energy sector is not just a vital contributor to the domestic economy, supporting thousands of jobs and generating substantial revenue. Its true strength lies in its international endeavors. The industry's exports reached an all-time high in the last years, marking its global significance. As we look to the horizon, the UK's stands at the precipice of greater achievements. Its commitment to international expansion, sustainable practices, and a brighter, energy-efficient future will undoubtedly leave an indelible mark on the global stage. The challenges may be formidable, but it is precisely these challenges that spur innovation, making the industry a beacon
For companies involved in innovative projects, tackling unforeseen and challenging developmental work to drive technological innovation warrants the exploration of HMRC’s R&D Tax Relief Scheme. As a leader in innovation funding, Leyton offers expert guidance and support for firms seeking financial backing for their R&D endeavors. Leyton's extensive experience can assist companies in availing significant tax relief for their pioneering work. By partnering with Leyton, companies can confidently apply for R&D funding, ensuring their innovative efforts are maximally rewarded.
Innovation is the lifeblood of the UK energy as industry, propelling it into new territories
www.sword-group.com
Harry Lind, Sword’s Subsurface Data Optimisation Services
Lead, has a background in petroleum geology and has clocked up 5 years’ experience in data management since joining the company. As well as overseeing the technical delivery of our UK Data Optimisation services, Harry actively contributes to a long-standing service improving the well data quality of one of Sword’s supermajor clients, ensuring subsurface teams always have trustworthy data at their fingertips.
Data of an unknown provenance, without verification, hinders the subsurface interpretation workflow and impacts the ability to extract actionable insight in multidisciplinary teams. In a mature basin such as the North Sea, where wells can be up to 60 years old and assets can change hands several times, the uncertainty of well data provenance is a challenge faced by most operators.
The legacy data which are digitally available to subsurface teams working in mature basins is often a mix of raw original data, interpreted and edited data, all stored together with inadequate labelling to differentiate between it all. Teams of geoscientists are faced with the unappealing challenge of producing a clear view of the subsurface from a dataset which is decades old shrouded in uncertainty.
When looking for original, raw, unedited information, the answer often lies in the many hundreds of boxes of hardcopy reports and logs which companies have piled high in storage facilities, largely unscanned and inaccessible to the subsurface community. Even if a complete library of these hardcopy documents exist, and has previously been scanned and made digitally available, all too often teams will find that files are now dispersed throughout a company’s digital environment.
Rather than driving value from their data and applications, experienced subsurface professionals are forced to choose between spending their limited time managing scattered, incomplete, duplicate, and conflicting datasets, or basing their decisionmaking on data which are not up to the job. Subsurface communities need access to a single source of the truth to make informed technical and commercial decisions.
Creating a suite of joined petrophysical curves which have been carefully verified against original well file material and capturing key well data from reports and logs in a structured and efficient way are essential components in the management of any E&P organisation's digital assets. Assuring the spatial integrity of this data through rigorous governance is a crucial foundation to ensuring a quality controlled, consolidated dataset. In turn, a consolidated dataset when formatted, becomes interpretation-ready, and set for consumption into applications and data environments to enable subsurface professionals to make informed decisions
Ensuring this level of quality relies on applying a trusted and repeatable methodology, something our experts have developed through 20 years of supporting operators and regulators alike. We identify and gather all relevant well data to allow for gap analysis to be carried out. Highlighting and, where possible, filling data gaps using original well documents, which also act as verification sources to identify what is raw information created during the drilling of the well versus data which has previously been edited. Following verification, our experienced consultants use their knowledge to process those data to predetermined standards, and quality controlled to ensure the final dataset is accurate and complete. The outcome of this process is a consolidated, formatted output of trusted well data upon which key decisions can be made with confidence.
Although a structured methodology, our approach is adaptable and responds easily to an operator’s well stock, exploration, development or acquisition/merger demand across multiple geographies.
Having a complete, accurate and structured dataset which can be relied upon to give a true reflection of the subsurface environment greatly reduces technical and commercial risk associated to assumption-making and poorquality data. It frees up subsurface experts to spend more time focusing on value-add, interpretation and engaging with their business to drive collaborative decision-making.
With corporate knowledge retained in a structured, accurate and complete well data asset, organisations choosing to optimise their data and leverage modern techniques and technology can greatly improve their regulatory compliance and gain a competitive edge over those who remain hamstrung by suboptimal datasets and practices.
In an increasingly digital world, it is more important than ever to have a clear data strategy prioritising verified data from trusted sources and making it readily available to end users. Doing so will allow the industry to maximise the potential of its subsurface data and drive better outcomes in a leaner environment.
www.renewableuk.com
RenewableUK members are enabling a just transtion to a net zero future. Focusing on continuous improvement around the three pillars of our Just Transition Tracker - People, Place and Planet These inspiring companies are a true showcase of the best that our industry has to offer.
North-east recruitment firm, TMM Recruitment, recently teamed up with X-Academy to deliver the final module of its two-year program to the first cohort of xccelerators. The career-based sessions aimed to equip the xccelerators with the skills they need to transition to work.
X-Academy focuses on developing skills and delivering jobs across the energy transition, for all of industry. Its goal is to provide the xccelerators with the knowledge, skills and experience required to enable them to thrive in a career in the energy sector.
Amanda McCulloch, chief executive of TMM Recruitment, said, “Even those with an established background in the world of work can find the move to a new role, never mind a new sector, a challenge. We were pleased to collaborate with X-Academy, using our extensive recruitment experience
and renewables sector knowledge to provide in-depth information and advice that will prove invaluable to the xccelerators.”
Matt Jacobs, VP operations and partnerships, X-Academy said: “The next generation of energy professionals is crucial to solving the capacity problem which is being faced by the sector.
“X-Academy is on a mission to develop people who can deliver transformational change across the energy industry. Our xccelerators are drawn from all walks of life and include individuals at the start of their career journey, those upskilling from existing energy sector jobs and those reskilling from completely different sectors. The one thing they all have in common is a desire to make an impact on real-life energy transition challenges.
“Working with TMM Recruitment is a key component of the X-Academy programme. The Transition to Work module covered areas of personal brand, LinkedIn profiles, CV building and interview techniques, ensuring our xccelerators complete their two-year programme with a real focus on how to maximise their next career move. This final module complemented the varied aspects of the development programme, ensuring those taking the next steps in their career have rounded experience across technical, behavioural, and professional skill sets.”
Amanda said: “The sessions the xccelerators participated in covered several aspects of looking for a new job. The way you present yourself is at the very heart of finding a new role. It is important to consider your personal brand style, and how this comes across – both on your CV and on platforms such as LinkedIn.”
The Transition to Work sessions were delivered by TMM Recruitment’s experienced recruiters. They worked with the xccelerators to help them to develop a personal brand which highlights each person’s uniqueness and as a result, means they stand out from the competition. The sessions also covered writing a CV.
Amanda said: “It is all too easy to throw the kitchen sink at a CV and include absolutely everything. Our experts were on hand to provide guidance on what to include, and importantly, what not to include. We also looked at how to add some impact so that the xccelerators can develop CVs which hit the mark and get noticed by employers and recruiters.
“The theme of developing the xccelerators’ personal brand continued as we looked at how to make effective use of LinkedIn. The sessions then wrapped up with a focus on interview skills – with the goal of ensuring the xccelerators can interview confidently.
“It is vital to see the interview as a conversation. In an interview situation, being prepared and asking questions is key. It can lead to interesting and informative discussions which can help you to make the right decision when reviewing job offers.
“We were delighted to work with the xccelerators as they
“The next generation of energy professionals is crucial to solving the capacity problem which is being faced by the sector."
www.infinity-partnership.com
Infinity Partnership is an award-winning, multi-disciplinary accountancy and business advisory practice, with a proactive approach to customer service.
Infinity has been a five-time winner at the British Accountancy Awards and has been a three-time finalist at the Scottish Accountancy Awards in recent times.
Nauticus Robotics Inc. has sealed a contract with Shell plc for inspection services on a Shell subsea field development in the Gulf of Mexico.
Nauticus, a developer of ocean robots and artificial intelligence for autonomous services for offshore industries, said in a news release that the contract has the possibility for future inspection service projects. The contract value was not disclosed.
The contract follows Nauticus’ successful qualification phase for autonomous methods of subsea operations for inspection services, and acknowledges the company’s “successful transition to a fully operational offshore services provider”, according to the release.
Nauticus said its flagship autonomous subsea robot Aquanaut would serve as the project’s "workhorse" and perform noncontact and contact inspections across an extensive subsea complex. The project features Nauticus’ first-to-market method of autonomous subsea manipulation on live subsea assets in water depths exceeding 3,281 feet (1000 meters).
A remote pilot will collaborate with Aquanaut during the operation through Nauticus’ acoustic communications link to ensure safe operations, the company noted.
The project also features what Shell has termed “a force multiplier” solution with multiple scopes of work to be executed simultaneously from a smaller class of service vessel that would not normally engage in inspection, maintenance, and repair (IMR) services, Nauticus said, adding
that Aquanaut not needing an umbilical is a “key enabler of business case”.
“Nauticus now has visibility long long-term IMR services work for Shell and the opportunity to become the preferred supplier for this advanced work", Nauticus CEO Nicolaus Radford said.
In June, Nauticus signed a contract with Petrobras to deploy Aquanaut to support the oil major’s offshore activities, according to an earlier news release.
Aquanaut will be deployed in Petrobras’ Deepwater Production Field using supervised autonomy for infield inspection services. The contract involves approximately two months of subsea inspection time and is one of the largest awarded contracts of its kind to date worldwide, according to the release.
“A contract with another worldwide leading operator for Nauticus speaks to the state-ofthe-art technologies of our autonomous robots as we further penetrate the global markets”, Radford said. “The market opportunity for Nauticus in offshore Brazil is significant, as it is one of the world's most active offshore energy basins; we are pleased to enter this market through a world-class operator. We competed through a rigorous tender process with many well-respected industry competitors to earn this business with Petrobras and eagerly await the deployment of our assets to validate our capabilities. We continue to build our robust pipeline of opportunities, giving us confidence to execute on our mission and deliver long-term value to shareholders”
The contracts are for COSL’s semisubmersible rigs COSLPromoter and COSLInnovator.
Oil and gas company Equinor has awarded two drilling contracts to COSL Offshore Management for work on the Norwegian Continental Shelf (NCS).
The contracts, worth $369m (Nkr3.9bn), are for COSL’s semi-submersible rigs COSLPromoter and COSLInnovator.
Equinor said the contracts cover casing running, maintenance of cement units, offshore waste management and remote-operated vehicle (ROV) operations.
Rig mobilisation and demobilisation expenses are also covered.
COSLPromoter, which is currently deployed by Equinor, will begin operating under the new one-year contract in the first quarter of 2025.
Equinor can extend the COSLPromoter drilling rig contract for up to four years.
COSLInnovator has been contracted for two years and will be deployed on the NCS at the beginning of the second quarter of 2025.
The second contract can be extended for up to three years.
To cut emissions from operations, Equinor says that both rigs have been revamped with energy-saving procedures and work methods.
• One of the world's first large-scale floating wind farms in development, MarramWind could provide up to 3 GW of cleaner renewable energy – enough to power the equivalent of more than 3.5 million homes.
• In the shift towards a low-carbon global economy, this project could help position Scotland as a global leader in offshore wind development.
Geoquip Marine, a specialist in acquiring, analysing, and reporting global offshore geotechnical data, is getting to work on gathering crucial engineering data to support the proposed MarramWind floating offshore windfarm.
• Geoquip Marine gets to work on gathering crucial geotechnical information to enable the development and construction of MarramWind floating offshore windfarm off the coast of Scotland
• Geoquip Marine's geotechnical investigation will gather soil and geotechnical data essential for designing and constructing floating platforms.
Valaris Limited announced new contracts and contract extensions, with an associated contract backlog of approximately $65 million.
Valaris executed a one-well contract with bp offshore Brazil for drillship VALARIS DS-15. The contract is expected to commence in the late first quarter or early second quarter 2024 in direct continuation of the rig’s current program, with TotalEnergies, and has an estimated duration of 80 days. The estimated contract value is approximately $33 million.
A previously disclosed exercised priced option with TotalEnergies offshore Brazil for drillship VALARIS DS-15 is now expected to be undertaken in direct continuation of the aforementioned bp contract. The option period is expected to commence in the late second quarter or early third quarter 2024 and has an estimated duration of 100 days. The operating day rate for the option period is approximately $254,000.
MarramWind is a joint venture between ScottishPower and Shell. The partners have chosen Geoquip Marine as their valued marine data specialist for site exploration and geotechnical data collation, which will help inform the project development and design activities.
To support the project, Geoquip Marine will perform a complete geotechnical investigation to gather soil and geotechnical data for developing an engineering ground model.
bp Indonesia also exercised a five-well priced option for heavy duty modern jack-up VALARIS 106. The option period is expected to commence in January 2024, in direct continuation of the existing firm program and has an estimated duration of 365 days. The operating day rate is $85,000 effective from January 6, 2024, increasing to $95,000 from January 6, 2025. The rig is expected to be out of service for approximately 90 days for planned maintenance across the second quarter and third quarter 2024.
The Swedish energy giant informed the German Federal Network Agency (BSH) that it has invoked its right of entry, thereby confirming the right to construct the wind farm.
The site was provisionally awarded to RWE in August, with BSH giving Vattenfall until 14 September to exercise its step-in right.
The 630MW project, also called Nordlicht II, is located 85 kilometres off the island of Borkum on the German North Sea coast.
Together with project N-7.2 (Nordlicht I) in the same area, the two projects will have a combined capacity of 1.6GW and are expected to generate electricity for more than 1.7 million German households.
Once Vattenfall reaches final investment decisions, Nordlicht I can be connected to the German electricity grid in 2027 and Nordlicht II in 2028.
“[These projects] will lead to a permanent reduction in Germany’s dependence on fossil fuels. In addition, offshore wind energy can make an important contribution to the conversion to a more climate-friendly production in some key industries. Within the framework of partnerships, we want to support that conversion", says Helene Biström, head of BA Wind at Vattenfall.
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Launched by Decom Mission at SPE Offshore Europe, a survey of the global decommissioning supply network will be the first to provide primary insight into its current capability and capacity, as well as providing a snapshot of sentiment across the sector.
The resulting report is due for publication in May 2024, and as the only independent trade organisation focused solely upon late life and decommissioning, its CEO, Sam Long, believes that Decom Mission is in the very best position to accurately reflect the current state of the decom supply network across the oil & gas, nuclear and renewable sectors.
In order to do so, Decom Mission has partnered with data science experts - and Decom Mission member - Empirisys, to develop and deliver the survey, following the impact made by the latter’s recent work in delivering the largest survey of its kind for industry organisation, Step Change in Safety.
Commenting on the launch Sam said: “I would urge any company active in the decommissioning supply network to complete this landmark survey. It forms a significant element of Decom Mission’s own development curve as we aim is to better inform both the supplier and operator/asset communities
across all energy sectors, enabling improved decommissioning forecasting, targeting of capital and resources and the development of strategy.
“Currently, there is constant emphasis on future opportunities within the energy industry; Decom Mission is adamant that those of the present should not be forgotten about. Decommissioning plays a crucial role in the energy transition and this survey focuses on the opportunities of today and tomorrowthat’s vital to the survival of this industry.”
Empirisys has used its in-house designed and built intelligent survey app – Sense – as the platform on which to base the Decom Mission survey. In addition to developing and delivering the survey, Empirisys’ team of data scientists and engineers will utilise machine learning, diagnostics and AI driven tools to analyse the information uncovered, and provide actionable insights.
Peter Sueref, Chief Technology Officer and cofounder of Empirisys added:
“It takes real skill in data analysis and interpretation to craft a survey that will help organisations to gather the information they need and, crucially, can rely upon. Fortunately, we have a team of world-class data scientists and engineers at Empirisys who possess that in abundance. Their extensive knowledge and experience have produced a survey which will elicit reliable, empirical data, using techniques such as reverse coding and a carefully balanced proportion of subjective and objectives questions to add validity.
“Partnering with Decom Mission is a fantastic opportunity for us to deploy our skillset in a situation where the results will inform real change in the decom supply network, enabling businesses to capitalise on opportunities as the drive to net zero accelerates.”
All supply network companies active in the decommissioning sector are encouraged to complete the Decom Mission survey which can be found online
A dock operator has secured its largest-ever oil and gas decommissioning project.
Port of Blyth has welcomed 7000-tonnes of ex-North Sea rigs to its Battleship Wharf terminal.
The apparatus, which includes several platform topsides and jackets, will be demolished by Thompsons of Prudhoe over the coming weeks.
Officials say waste from the rigs will be segregated as works progress, with a “high percentage” of materials to be recycled.
Martin Lawlor, Port of Blyth chief executive, said: “By combining the port’s offshore energy cargo-related handling capabilities with Thompsons of Prudhoe’s decommissioning and demolition expertise, customers are able to rely on first-class service based on quality, safety and performance.
“We have established a great track record of successful high-profile
decommissioning projects, and are looking forward to supporting further work across the offshore energy sector.”
Tom Koerner, Thompsons of Prudhoe operations director, added: “We are delighted to be given the opportunity to decommission these assets on behalf of our client.
“This gives us a strong platform to demonstrate our capabilities for all future onshore dismantling and waste disposal requirements.”
Petrobras signed an agreement with Porto do Açu (RJ) to provide support to the decommissioning of oil and gas platforms. The agreement makes docks available for platforms undergoing decommissioning until the final destination of the unit has been decided, in accordance with best international practices on green recycling and sustainability.
The contract with Porto do Açu, located in the city of São João da Barra (RJ), is for three years and also covers support services to the units, electricity supplies, etc. The agreement is part of Petrobras’s plan to decommission a total of 26 platforms by 2030.
The decommissioning consists of various activities to finalize the operative capacity of the platform definitively. It is a natural element of the production cycle in the oil and gas industry. Petrobras has set aside $9.8 billion for its decommissioning activities, according to its 2023-2027 Strategic Plan.
The company expects to decommission 26 platforms over the next five years. These decommissioning activities involve permanently sealing wells and cleaning and disposing of the underwater systems and platforms.
The sustainable disposal of P-32. Petrobras completed the auctioning off of the P-32 platform in July, the first platform disposed under the sustainable disposal model adopted by the company. The successful bidder was GERDAU S.A, in partnership with the shipyard, ECOVIX. The P-32, currently in the Campos basin, will be taken directly to the ECOVIX yard, where the vessel will be recycled.
Offshore O&G-related engineering, procurement and construction (EPC) contract award value year-to-date is estimated at US$27.4 billion, excluding letters of intent (LoI). This represents US$3.7 billion of EPC contract award value recorded over the last month. Given the announced contracts, Westwood has recorded 218 subsea tree unit awards year-todate, approximately 3,000km of SURF and about 2,300km of pipeline. For production platforms, 11 floating production units have been awarded in 2023, including seven FPSO units, two FLNG units and two FPSS units.
During the period under review, Woodside Energy Group awarded OneSubsea a contract to supply 18 subsea trees (nine producers, seven water injection wells and two gas injectors) for its Trion development offshore Mexico. The award follows project sanctioning announced in June 2023, with Hyundai Heavy Industries (HHI) already being contracted to supply a floating production unit (FPU). A subsequent contract for the project’s floating storage and offloading (FSO) unit is expected to be awarded to SBM Offshore later in the year.
In the past month, Saipem announced several contract awards valued at approximately US$1.6 billion. This includes a contract from Eni, which was later subcontracted to CIMC Raffles, for the conversion of the Scarabeo 5 semisubmersible (semi) drilling unit into a separation and boosting plant FPU set to be installed at the Nene Marine development offshore the Republic of Congo. Also offshore the Ivory Coast, Eni awarded Saipem an engineering, procurement and installation (EPCI) contract for subsea umbilicals, risers and flowlines (SURF) at the Baleine Phase Two project. The contractor also received a pipeline EPCI contract related to Snam Group’s floating storage and regasification unit (FSRU) project in Ravenna, Italy. In the US GoM, Seatrium announced it signed a LoI with Shell to provide services to carry out construction work related to the Sparta project. The Sparta FPU will be a replica of Shell's Vito and Whale platform and will comprise a single topside module supported by a four-column semi floating hull. A final contract award is subject to final investment decision (FID) on the project.
Looking forward, Westwood forecasts an additional US$27.7 billion of offshore O&G-related EPC spend for the remainder of 2023, of which 30% is anticipated to be driven by activities in the Middle East. This includes ADNOC’s Hail & Ghasha project, Saudi Aramco’s Zuluf and Qatar Energy’s North Field South projects. Outside the Middle East, operator-announced projects, including Delfin LNG’s and Cedar LNG’s FLNG units, with an estimated EPC value of US$3.5 billion, are expected to be sanctioned before the end of 2023.
The global committed jackup count averaged 402 units in August. The marketed available and cold-stacked jackup counts now stand at 33 and 57, respectively, while marketed committed utilisation and total utilisation were 92% and 82%, respectively. During the month, a total of 10 contracts were awarded and one option exercised, amounting to 4,366 days (12.0 rig years) of backlog added. Arabdrill 60 has secured a contract extension for the next three years, with commencement in direct continuation of current contract.
The global committed semi count came in at 70 during August. There are nine available and 16 cold-stacked rigs remaining in the fleet. Marketed utilisation remained at 89% during the month, with total fleet utilisation at 74%. Six new contracts were awarded in August, one of which was awarded to Alpha Star by Petrobras, keeping the rig engaged to the operator from 2025-28.
Finally, the drillship count grew by two units to 82 during the month, leaving three marketed units available plus 12 cold-stacked rigs. Marketed committed and total utilisation rose to 97% and 85%, respectively. Nine new contracts were awarded, where Petrobras awarded 66% of total drilling days for three rigs with commencement in 2024.
Since the last update, Vestas signed a conditional agreement with PKN Orlen and Northland Power to supply 76 V236-15.0 MW wind turbines for the 1,140 MW Baltic Power wind farm, located offshore Poland. An export cable supply contract was also recently finalised and signed by NKT at this wind farm. The contract has been valued at over US$136 million and it will be executed by NKT in a consortium with two unnamed partners.
Dominating headlines was news that RWE Renewables secured the rights to develop the 1,244 MW Lake Charles Lease Area, located offshore Louisiana, USA. The developer won the rights in the Gulf of Mexico offshore wind auction, with a winning bid of US$5.6 million. Meanwhile, the 1,244 MW Galveston I and 1,175 MW Galveston II lease areas, located offshore Texas, attracted no bids.
Finally in Germany, the winners of Germany's latest offshore wind auction that was held for pre-examined areas was announced by Germany’s Federal Network Agency. RWE was granted the rights to the 480 MW Delta Nordsee, the 420 MW Nordsee 3 and 630 MW Project site N-6.6. Waterkant Energy was awarded the development rights to the 270 MW Project Site N-6.7 wind farm. A total of EUR784 million (US$865 million) has been generated in this auction and all four wind farms are scheduled to come online in 2028.
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World Nuclear Association Symposium 2023
6-8 October 2023
London, Great Britain
Ecomondo 2023
7-10 October 2023
Rimini, Italy
Vakbeurs Energie 2023
10-12 October
2023Hertogenbosch , Netherlands
Energy Management Summit
10-11 October 2023
London, UK
Energy Management Summit
10-11 October 2023
London, UK
Intermodal Europe 2023
10-12 October 2023
Amsterdam, Netherlands
Elek Ener 2023
11-15 October 2023
Tunis, Tunisia
Bangladesh International Marine And Offshore Expo 2023
12-14 October 2023
Dacca, Bangladesh
Powerexpo Almaty 2023
17-19 October 2023
Almaty, Kazakhstan
Iraq Oil & Gas Basra Show 2023
17-19 October 2023
Basra, Iraq
Aviation Week MRO Europe
17-19 October 2023
Amsterdam, Netherlands
Energy Taiwan 2023
18-20 October 2023
Taipei, Thailand
Singapore International Energy Week 2023
23-27 October 2023
Singapore
OTC Brasil 2023
24-26 October 2023
Rio de Janeiro, Brazil
If you look at the question of developing internationally, particularly from a North Sea origin point of view we have to be realistic and accept that the best of the growth opportunities are behind us. Therefore, to sustain and grow businesses the international dimension is absolutely imperative.
I also think internationalising a business drives a management team, it drives the people, it drives the technology, it drives the systems to a new higher level. I think a business which has an international dimension to it is going to have a much higher chance of succeeding to higher levels. It just raises the bar, it raises the game for everyone involved in that business.
We see expansion opportunities coming from two directions, first of all as we move from our traditional support of advanced petroleum technology businesses we see a lot of opportunities in the energy transition technology businesses on one route. Secondly, we see a geographical opportunity: We do have joint ventures moving forward this year for India and Egypt, the wider Egypt, north Africa, Mediterranean covering the east and the west flanks of the Middle East. We also see opportunities for growth in the Caspian and central Asian direction to the north and the east African direction.
HFI is a specialist professional services firm led by Hugh Fraser, a Scottish corporate/energy lawyer with over 30 years’ experience in the international energy sector.
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Our focus is on ventures which combine advanced energy technology and know-how with opportunities in the key territories of the Middle East region including joint ventures, acquisitions and divestments.
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Hydrocarbons are, and will continue to be, key to a successful energy transition. Global demand will continue to rise as oil and gas remain critical components in the broad mix of solutions required to satisfy the world's growing energy needs, accelerated by supply and demand, higher commodity prices, market volatility and historical underinvestment.
Against this backdrop, the Middle East region has positioned itself as a cornerstone of world energy security, and the largest integrated energy companies are investing in the development of new and existing fields at unprecedented scale and speed. As demand for development in the Middle East continues at pace, there is also corresponding demand for the development of reliable contracting principles and market standards to provide a clear and consistent framework for the commercial and contractual relationships that will underpin and sustain this growth. In the face of these demands, we look at certain common law contracting principles and market standards that have originated and evolved within the United Kingdom Continental Shelf (UKCS) and the North Americas, and consider
how it should not be assumed that they can be imported and applied seamlessly into the civil law jurisdictions in the Middle East.
As the global petroleum industry has evolved, so to have certain model contracts and uniform contracting principles in two mature hydrocarbon jurisdictions, the United Kingdom and the North Americas. Over the course of time, these contracting models have been applied, adapted and relied upon by host country governments, operators and contractors in an attempt to regulate the highly complex risk and revenue relationships involved in the exploration, production and operation of oil and gas basins.
The UKCS, long recognised as an oil and gas centre of excellence, is the birthplace of standardised oil and gas industry contracts, originally developed under the CRINE initiative and now administered by LOGIC. The contracting community in the offshore environment of the UKCS has long looked to the protections of doctrines enshrined in a deep body of English case law precedent such as the industry wide mutual hold harmless indemnity regime. In the Americas, similar model contracting principles have emerged under the auspices of the IADC model forms and latterly the AIEN with its rich history rooted in Houston's upstream oil sector. Progressively developed by subject matter experts, these model contracts have been widely relied upon in the energy industry by all forms of market participants as the basis for executing some of the largest oil and gas projects in the world.
However, looking to the Middle East, where some of the largest reserves in the world remain to be developed in countries like Saudi Arabia, Iraq, the United Arab Emirates, Qatar and Kuwait, it is ill-advised to assume that model contract standards well settled in the UK can be seamlessly imported and assimilated into upstream oilfield services agreements in the civil law jurisdictions of the Arabian Gulf. This is a significant concern because, with certain exceptions, Middle Eastern legal systems are founded upon principles of civil law which are codified and derived from Egyptian law, which was in turn heavily influenced by the French legal system. Though jurisprudence is young in legal terms, legal scholars and judicial authority are clear that certain common law concepts are alien to civil law. And while most civil law legal systems in the Middle East recognise that contracting parties enjoy freedom of contract, certain common law concepts are not codified under these civil law systems.
Extraction, production and operation of hydrocarbons is an inherently high risk endeavour. One of the primary imperatives of parties contracting in the oil and gas industry is to clearly regulate, delineate and assign risk allocation with as much certainty as possible. Notwithstanding what is contractually agreed, where market participants conducting petroleum operations in the Middle East are importing common law concepts into upstream oilfield services contracts, and where the governing law chosen by the parties is a civil law legal system, there remains a residual risk that a tribunal or court may adjudicate outcomes which are different to the common intention of the parties on the basis of the disparity between legal principles.
From the North east to the Middle East - the challenges of applying common law contracting principles from a mature basin to the civil law of the Arabian Gulf
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